FOREX-Dollar up, loonie and kiwi in focus before central bank meetings

Tue Sep 8, 2015 8:52pm EDT
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* Equities rally amid return in global risk appetite lifts dollar

* Loonie, kiwi in focus ahead of Canadian, NZ meetings

* Markets focus on how dovish the c.banks may sound

By Shinichi Saoshiro

TOKYO, Sept 9 (Reuters) - The dollar gained against the safe-haven yen on Wednesday, boosted by a surge in European and U.S. stocks amid a global recovery in risk appetite that also drove rallies in commodity currencies such as the Australian and Canadian dollars.

The dollar was up 0.2 percent at 120.09 yen, extending gains from an overnight low of 118.885, with a spike in U.S. debt yields on reduced risk aversion helping the greenback.

The Australian dollar edged up to $0.7036, adding to the 1.4 percent surge overnight which whisked it away from a 6-1/2-year low of $0.6892 struck on Monday.

"Equity movements continue to impact the dollar and yen, but they won't be taking centre stage today. Instead, the Canadian and New Zealand dollars, which are likely to move more ahead of their central bank policy decisions, will gather much of the attention," said Masafumi Yamamoto, senior strategist at Monex in Tokyo.

The Bank of Canada is widely expected to keep interest rates unchanged at 0.5 percent in light of recently upbeat data after already cutting twice this year, although market participants are readying for possibly dovish undertones from the central bank. The decision is due at 1400 GMT.   Continued...