CORRECTED-Foreign exchange-Yen supported, yuan frail on coronavirus concerns – Reuters

(Corrects the Australian dollar’s milestone to six-week lows, not ten-week lows, in fifth paragraph)

* Yuan, Aussie underneath stress as buyers evaluate overall health danger

* 2002-three SARS epidemic did not have lasting current market effects -analysts

* Graphic: Earth Fx costs in 2020

By Hideyuki Sano

TOKYO, Jan 22 (Reuters) – The yen was supported whilst the yuan was on the back again foot on Wednesday as buyers tried using to evaluate the chance of the outbreak of a new coronavirus in China disrupting the country’s economy and trade companions.

The virus, which leads to a sort of pneumonia, has unfold to cities including Beijing and Shanghai as the range of sufferers in China additional than tripled. Far more conditions have been also documented outside China, including the United States.

In opposition to the yen, the U.S. dollar slipped to 109.86 yen from Tuesday’s significant of a hundred and ten.23.

The offshore yuan misplaced .6% on Tuesday, its most significant drop in additional than a month, and very last stood at 6.9100 yuan for every dollar .

The Australian dollar, often applied as a proxy wager on the Chinese economy, fetched $.6844, around its most affordable levels in six weeks.

Information of the coronavirus evoked memories of the 2002/03 outbreak of Intense Acute Respiratory Syndrome (SARS), which killed nearly 800 people today globally and led to a sharp downturn in tourism in Asia.

“The clear comparison people today are building is with the SARS. Even though we even now never know how lethal the new virus will be, my sense at the instant is that markets are not getting it as dire as SARS,” mentioned Kyosuke Suzuki, director of currencies at Societe Generale in Tokyo.

“Back then, almost each company was banning travel to Hong Kong. We haven’t seen that variety of reaction however,” he mentioned.

Tohru Sasaki, head of Japan current market research at JPMorgan, mentioned that whilst the SARS outbreak prompted large financial downturn in Hong Kong and Singapore for about eight weeks by a fall in tourism, the pandemic had minimal effects on supply chains in Asia.

“If the most current virus reaches a equivalent magnitude, some economies these as Thailand, Singapore and Malaysia could be negatively affected by a fall in tourism. But its very long-time period effects on the international economy and the forex current market will be minimal,” he mentioned.

The euro stood at $one.1083, immediately after dipping slightly on Monday.

Sterling traded at $one.3050, possessing obtained a tad on Tuesday immediately after facts confirmed the British economy designed employment at its strongest rate in nearly a year in the three months to November.

The solid facts slightly dented expectations of an fascination rate slice by the Bank of England at the stop of this month, though markets are even now pricing in about a 60% chance of a .twenty five share position slice.

Reporting by Hideyuki Sano Enhancing by Christopher Cushing

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