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FOREX-Dollar gains ground on economic concerns

    * Graphic: World FX rates in 2020

 (Updates prices, adds commentary, changes byline, previous dateline LONDON)
    By Sinéad Carew
    NEW YORK, Sept 24 (Reuters) - The U.S. dollar traded at a two-month high and was set for a fifth day
of gains on Thursday as investors sought safety on concerns over economic recovery as coronavirus cases
surged in Europe and on U.S. data showed rising unemployment claims.
    Federal Reserve policymakers have called on the U.S. government to provide more fiscal support,
fuelling a bout of selling in risky assets overnight, while European economic data has worsened in recent
days prompting investors to lighten their positions after a rally in August.
    Initial claims for state unemployment benefits increased 4,000 to a seasonally adjusted 870,000 for
the week ended Sept. 19, compared to 866,000 in the prior week and economist expectations for 840,000
    "The U.S. dollar weakness theme got over-extended and there are people covering their shorts and
wondering if the weaker dollar trend has had enough. Economic data could play into that narrative," said
Katy Kaminski, chief research strategist and portfolio manager at AlphaSimplex Group, in Boston. 
    The dollar index, which measures the greenback against a basket of major currencies, was last
up 0.08% at 94.46 after earlier rising to 94.59, its highest level since July 24.
    Appetite for riskier assets was already souring on Wednesday after data showed U.S. business activity
slowed in September and new restrictions to stem a surge in coronavirus infections in Europe hit the
services industry.
    Also puncturing market optimism were concerns U.S. policymakers will struggle to reach an agreement
for more fiscal stimulus as the Nov. 3 presidential election looms.
    "Optimism on the recovery, optimism on the virus, and bets on stimulus were keeping markets well bid,
and on all three of these issues, there has been a degree of disappointment this month," said John Velis,
an FX and macro strategist at BNY Mellon.
    Federal Reserve officials on Wednesday doubled down on efforts to convince investors they will keep
monetary policy easy for years to allow unemployment to fall, emphasizing that interest rates will stay
near zero until inflation gets to 2% and stays there.
    Boston Federal Reserve Bank President Eric Rosengren said on Thursday the U.S. economy was far from
maximum employment or 2% inflation, and that interest rates would stay low for several years.
    The Norwegian and the Swedish crown came under particular selling pressure. The dollar was last up 1%
against the Swedish crown after touching its highest level against the currency since July 14. 
The dollar was up 0.64% and at its highest since July 1 against the Norwegian crown. 
    The British pound was slightly higher after the country's finance minister Rishi Sunak
announced a new job support scheme, but said the government wouldn't save every job.
    The euro was down 0.12% against the dollar at $1.1645.
    EU health officials warned on Thursday that a surge in COVID-19 cases in Europe risks becoming a
deadly double epidemic of flu and coronavirus infections as they urged Europeans and their governments not
to let their guard down.
    The Aussie dollar fell 0.51% to $0.7038, near its weakest since July 21. 
    Currency bid prices at 10:21AM (1421 GMT)
 Description      RIC         Last           U.S. Close  Pct Change     YTD Pct     High Bid    Low Bid
                                              Previous                   Change                 
 Euro/Dollar      EUR=        $1.1645        $1.1659     -0.12%         +3.85%      +1.1680     +1.1627
 Dollar/Yen       JPY=        105.3800       105.3700    +0.01%         -3.19%      +105.5200   +105.2100
 Euro/Yen         EURJPY=     122.71         122.83      -0.10%         +0.62%      +123.1100   +122.5900
 Dollar/Swiss     CHF=        0.9259         0.9238      +0.23%         -4.35%      +0.9268     +0.9217
 Sterling/Dollar  GBP=        1.2732         1.2722      +0.08%         -3.97%      +1.2781     +1.2691
 Dollar/Canadian  CAD=        1.3386         1.3385      +0.01%         +3.08%      +1.3417     +1.3372
 Australian/Doll  AUD=        0.7038         0.7074      -0.51%         +0.24%      +0.7082     +0.7017
 Euro/Swiss       EURCHF=     1.0779         1.0774      +0.05%         -0.67%      +1.0789     +1.0756
 Euro/Sterling    EURGBP=     0.9142         0.9162      -0.22%         +8.14%      +0.9180     +0.9114
 NZ               NZD=        0.6528         0.6546      -0.27%         -3.09%      +0.6557     +0.6513
 Dollar/Norway    NOK=        9.5638         9.4907      +0.77%         +8.92%      +9.5954     +9.4733
 Euro/Norway      EURNOK=     11.1371        11.0671     +0.63%         +13.21%     +11.1774    +11.0520
 Dollar/Sweden    SEK=        9.1120         8.9971      +1.00%         -2.52%      +9.1267     +8.9987
 Euro/Sweden      EURSEK=     10.6131        10.5080     +1.00%         +1.36%      +10.6278    +10.5051

 (Additional reporting by Saikat Chatterjee in London; Editing by Kirsten Donovan and Bernadette Baum)