LONDON (Reuters) - The New Zealand and Australian dollar were the biggest gainers among major currencies on Tuesday, helped by talk from their central banks, while the U.S. dollar took a backseat to the Japanese yen and Swiss franc amid some risk aversion in markets. The Australian dollar spiked higher after the Reserve Bank of Australia stuck with its plan to taper its bond-buying programme, shrugging off concerns about the economic impact from rising coronavirus cases. It gained half a percent to $0.7393 against its U.S. counterpart. The Kiwi dollar rose 0.6% to $0.7007 after New Zealand’s central bank said on Tuesday it would soon begin consulting on ways to tighten mortgage lending standards, as it tries to control an inflated housing market and protect home buyers. The U.S. dollar slipped 0.1% to 109.21 yen, near its July 19 low of 109.07, which was its lowest level since late May. Against the Swiss franc, the dollar traded at 0.9046 franc, having hit a 1-1/2-month low of 0.9038 in the previous session. “What we’re seeing is a G10 FX market that is typical for this time of year - there’s always a summer lull when volumes drop significantly - but which is also typical of the quiet that we have seen lately in the days leading up to a nonfarm payrolls number,” said Michael Brown, senior market analyst at CaxtonFX. “The Fed have been incredibly clear in stressing the importance of labour market data, so it’s no surprise to see a bit of apprehension before the report drops.” Market watchers have of late pointed to the decline in U.S. Treasury yields as being indicative of fears of a coming disappointment in economic growth. The U.S. 10-year Treasury yield dropped on Monday shortly after an Institute for Supply Management (ISM) report showed July U.S. manufacturing growth slowed for the second successive month. Clouding the outlook further is the spread of the COVID-19 Delta variant. In the United States, COVID-19 hospital admissions in Louisiana and Florida have hit a new peak though top U.S. health expert Anthony Fauci has ruled out another lockdown in the country. That outweighed any excitement over a $1-trillion infrastructure investment bill that could be ready for a final vote as early as this week. The euro was a touch higher at $1.1880, having lost some momentum after hitting a one-month high of $1.1909 on Friday. Sterling gained 0.2% to $1.3914, just off Friday’s one-month high of $1.39835. “At the end of the day, there’s nothing we can do but wait and see how the spread of Delta will or will not change the Federal Reserve’s policy stance,” said Kazushige Kaida, head of FX sales at State Street Bank’s Tokyo branch. Japan expanded state of emergency curbs to more regions on Monday as cases hit a record in Tokyo. In China, the spreading Delta variant poses new risks for the world’s second-biggest economy. Additional reporting by Hideyuki Sano in Tokyo, Editing by Timothy Heritage Our Standards: The Thomson Reuters Trust Principles.
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