FOREX-Dollar pares losses as Senate's McConnell vague on further stimulus

    * Graphic: World FX rates in 2020 tmsnrt.rs/2RBWI5E

 (Adds quotes, McConnell comments on stimulus, updates prices)
    By Karen Brettell
    NEW YORK, Dec 29 (Reuters) - The dollar pared losses on
Tuesday after earlier reaching a more than two-year low against
the euro, but remained lower on the day as investors weighed
whether an increase in U.S. fiscal stimulus is likely.
    U.S. Senate Majority Leader Mitch McConnell on Tuesday
blocked immediate consideration of a measure to increase
COVID-19 relief payments to $2,000. He suggested the Senate
would at least examine the issue.
    “This just really delays the inevitable,” said Edward Moya,
senior market analyst at OANDA in New York.
    “With the Biden administration coming into place you’re
going to have expectations that we’re going to see another
attempt at more stimulus, and that’s why I think the dollar
trimmed its losses but very limitedly,” Moya said.
    The dollar fell 0.28% against a basket of currencies
to 89.99. It is holding just above a two-and-a-half year low of
89.72 reached on Dec. 17.
    Trading is thin with many investors out between the
Christmas and New Year holidays. 
    The euro gained 0.28% to $1.2251 after getting as
high as $1.2274, the strongest since April 2018.
    The Aussie gained 0.39% to $0.7610. It reached
$0.7639 on Dec. 17, the highest since June 2018.
    The greenback slipped 0.29% against the Canadian dollar
 to 1.2810 Canadian dollars. The loonie reached 1.2684
on Dec. 17, the strongest since April 2018.
    Investors are betting the greenback will continue to decline
- it is down 6.77% this year - on expectations the Federal
Reserve will hold interest rates near zero and the U.S. economy
will struggle to recover from coronavirus-related shutdowns.
    Data released by the Commodity Futures Trading Commission on
Monday showed traders increased bets against the dollar in the
week ended Dec. 21 to $26.6 billion. That was the highest in
three months, according to Reuters calculations.
    A key factor on how much more stimulus is forthcoming will
also be two Georgia Senate runoffs next month that will
determine which party controls the upper U.S. chamber.
    “I think consensus is that Republicans will win one of those
seats,” said Moya. However, “the Democrats might have a
one-in-three chance of pulling this off and that is not
reflected in prices right now.”
    The euro was also buoyed on Tuesday by a trade deal reached
last week for Britain to leave the European Union. Though the
agreement is not comprehensive, it avoided a damaging no-deal
outcome.
    Sterling rose 0.33% to $1.3500 following a two-day
dip. It was as high as $1.3625 this month, a level unseen since
May 2018, but investors have taken some profits since the Brexit
trade deal was struck.
    Bitcoin < BTC=BTSP> fell 0.61% to $26,871 after hitting a
record $28,378 on Sunday. The currency has surged 275% this year
as it gains more acceptance from mainstream investors.
    XRP the third-biggest digital currency, slumped
13% after Coinbase, a major U.S. virtual coin exchange, said it
would suspend XRP trading.
    The move came after U.S. regulators charged Ripple, a
blockchain firm associated with XRP, with conducting a $1.3
billion unregistered securities offering. Ripple has denied the
charges.
    
    ========================================================
    Currency bid prices at 3:19PM (2019 GMT)
 Description      RIC         Last           U.S. Close   Pct Change     YTD Pct     High Bid    Low Bid
                                              Previous                    Change                 
                                              Session                                            
 Dollar index                 89.9890        90.2430      -0.28%         +0.00%      +90.2530    +89.8510
 Euro/Dollar                  $1.2251        $1.2216      +0.28%         +9.27%      +$1.2275    +$1.2207
 Dollar/Yen                   103.5100       103.8250     -0.33%         -4.72%      +103.8000   +103.4850
 Euro/Yen                     126.85         126.77       +0.06%         +4.02%      +127.2300   +126.7100
 Dollar/Swiss                 0.8845         0.8886       -0.46%         -8.59%      +0.8887     +0.8831
 Sterling/Dollar              $1.3500        $1.3460      +0.33%         +1.82%      +$1.3521    +$1.3443
 Dollar/Canadian              1.2810         1.2849       -0.29%         -1.38%      +1.2849     +1.2780
 Aussie/Dollar                $0.7610        $0.7583      +0.39%         +8.49%      +$0.7625    +$0.7577
 Euro/Swiss                   1.0836         1.0852       -0.15%         -0.15%      +1.0875     +1.0823
 Euro/Sterling                0.9074         0.9078       -0.04%         +7.33%      +0.9094     +0.9057
 NZ                           $0.7148        $0.7103      +0.65%         +6.24%      +$0.7164    +$0.7099
 Dollar/Dollar                                                                                   
 Dollar/Norway                8.6110         8.6490       -0.40%         -1.80%      +8.6405     +8.5860
 Euro/Norway                  10.5510        10.5470      +0.04%         +7.25%      +10.5815    +10.4950
 Dollar/Sweden                8.1980         8.2569       -0.49%         -12.30%     +8.2842     +8.1795
 Euro/Sweden                  10.0498        10.0990      -0.49%         -4.01%      +10.1328    +10.0403
 

 (Additional reporting by Marc Jones in London; Editing by Dan
Grebler)