* Risk appetite wanes; stocks, commodities decline
* U.S. dollar, Japanese yen gain vs euro
* Australian, New Zealand dollars fall
(Recasts; writes through, updates prices, changes byline)
By Nick Olivari
NEW YORK, Nov 19 (Reuters) - The dollar and yen rose on
Thursday amid revived safe-haven demand for the U.S. and
Japanese currencies following a pullback in risk appetite as
illustrated by declines in equity and commodity markets.
The dollar and commodities are often inversely correlated,
with oil, gold and other raw materials priced in dollars and
themselves seen as alternative currencies and hard assets.
Analysts said investors were turning cautious after recent
economic data has not been as rosy as forecast, stoking worries
that the sharp rally in riskier assets over the past several
months may have been overdone.
The yen rallied broadly, hitting its highest level against
the euro in more than two weeks, while the higher-yielding,
commodity-linked Australian and New Zealand dollars tumbled.
"It's probably a combination of the notion that the global
economic data has been going through somewhat of a soft patch
recently and the fact that the year-end is approaching," said
Vassili Serebriakov, currency strategist at Wells Fargo in New
York.
In late afternoon New York trade, the euro fell 0.3 percent
to $1.4917 <EUR=>. It remained within the range of a large
$1.48 to $1.51 "double no touch" options structure expiring on
Friday.
The euro-zone currency also slid to a more than two-week
low against the yen <EURJPY=> as losses accelerated after
breaking technical support at the 200-day moving average of
around 132.00, according to Reuters data.
The euro later rebounded to 132.78 yen, but was still down
0.7 percent for the day in volatile trading with a range of
almost 2 yen separating the day's high and low.
A senior economic adviser to the German government told
Reuters Television that Germany could face a double-dip
recession in late 2010 or early 2011 as extra public spending
is withdrawn. For story, see []
The dollar fell 0.4 percent <JPY=> to 88.02 yen after
bottoming at 88.64 yen -- its lowest level since Oct. 9,
according to Reuters data.
"The decline in risk appetite has prompted some squaring of
positions particularly in the yen, which was oversold against
the majors," said Michael Woolfolk, senior currency strategist
at BNY Mellon in New York.
RISKY ASSETS PULL BACK
All three major U.S. stock indexes ended lower on Thursday
with the tech-heavy Nasdaq sliding 1.66 percent.
Oil <CLc1> prices fell while while gold eked out a gain
<XAU=> on demand by investment funds after being lower for most
of the session.
Investors were also wary of talk from emerging market
countries about capital controls to limit some of the flows of
hot money into their economies, with new steps announced by
Brazil and South Korea. [] []
The ICE Futures U.S. dollar index <.DXY>, a non-traded
calculation measuring the greenback's performance against a
basket of six currencies, rose 0.2 percent to 75.307. The index
hit a 15-month low of 74.679 earlier this week.
Some 13,345 contracts had changed hands in the December
dollar index futures as the New York session wound down.
Average daily volume in the year to date stands at 8,286. The
December futures contract was last unchanged at 75.37. Open
interest was posted at 40,085.
Federal Reserve officials on Thursday downplayed the
consequences of the falling U.S. dollar, underscoring that
deflation is still a threat, especially with commercial real
estate prices falling. []
A survey on Thursday showed factory activity in the U.S.
Mid-Atlantic region grew in November for a fourth straight
month, which was faster than expected, but that was not enough
to offset general economic gloom. []
The Australian dollar fell to a two-week low and last
traded 1.1 percent lower at US$0.9193 <AUD=>. The New Zealand
dollar lost 1.9 percent to US$0.7315 <NZD=>.
