Demand strengthened for the dollar index and the safe-haven Japanese yen firmed modestly by midmorning on Wednesday as a risk-off tone returned to markets amid continued uncertainty about the economic fallout of the coronavirus outbreak.
Although markets had calmed somewhat overnight and appetite for risk assets returned, weakening the yen and Swiss franc,
continued uncertainty about the impact of the virus on China and the knock-on effects globally has kept investors wary.
"The session turned to a risk-off tone over the last hour," said Greg Anderson, global head of foreign exchange strategy at BMO Capital Markets.
The yen was last 0.07% stronger at 109.05 per dollar. Against the euro the yen was 0.24% stronger at 120.01.
The offshore Chinese yuan - heavily sold in recent days - was roughly unchanged on the day, last trading at 6.968. The Australian dollar, highly exposed to the Chinese economy, has fallen 1.35% since Friday's close, and was last down 0.35% at 0.674.
The dollar index, which weighs the greenback against a basket of six major currencies, held near two-month highs, last trading up 0.9% at 98.109. The dollar index, a safe-haven asset, has remained bid this week even amid momentary reprieves in market anxiety about the coronavirus.
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