* Dollar gains as investors seek "safer" assets
* U.S. retail sales rise unexpectedly in January
* Markets unimpressed by U.S. stimulus deal, bank plan
* Relative high-yielding currencies fall most
(Updates prices, adds quotes)
By Gertrude Chavez-Dreyfuss
NEW YORK, Feb 12 (Reuters) - The dollar climbed against
most major currencies on Thursday, attracting safe-haven bids
amid concerns about weakness in global stock markets and the
effectiveness of U.S. government policies in combating
recession.
This tense climate meant the biggest losers among major
currencies were the Australian and New Zealand dollars, which
have a relatively high yield and attract investors when they
are interested in riskier investments.
Lower risk appetite also fueled strong demand for
government debt, another safe-haven destination. Data showing a
surprise rebound in U.S. retail sales and lower jobless claims
did little to ease the anxiety.
"The dollar is getting support from a lack of belief in any
good piece of economic data and lack of belief that efforts by
the U.S. administration will pay dividends," said Nick
Bennenbroek, head of FX strategy at Wells Fargo in New York.
In midday trading, the euro traded at $1.2807, down 0.7
percent after an earlier plunge to $1.2728 <EUR=>, its lowest
since Feb. 2, according to electronic trading platform EBS.
The dollar was little changed at 90.40 yen <JPY=>, while
the euro <EURJPY=> lost 0.7 percent to 115.82.
The dollar and yen tend to benefit when investors are
nervous about the state of the global economy and are inclined
to sell riskier assets like stocks and commodities funded by
the two currencies.
But the volatile environment meant surges or dips in risk
appetite tend to be fleeting, with investor sentiment very much
dependent on the latest piece of economic news or government
policies to stem the financial crisis.
DISENCHANTED INVESTORS
Overall, investors remained disenchanted with the U.S.
government's efforts to stimulate the economy, its measures
seen as falling short of the market's very high expectations.
"Many investors perceive the banking bailout package and
the stimulus spending bill (as) poorly designed and too
little," said Andrew Wilkinson, senior market analyst, at
Interactive Brokers in Greenwich, Connecticut.
"This risk aversion theme is not entirely the path we had
expected the dollar to take, yet the potential for global
fallout means that the prospects for the dollar are more,
rather than less, positive."
Market anxiety lingered even though U.S. congressional
negotiators reached a deal on Wednesday on $789 billion in
emergency spending and tax cuts aimed at pulling the economy
out of a deepening recession. A vote on the package could take
place as early as Thursday. For details, see []
Earlier data showing sales at U.S. retailers unexpectedly
rebounded in January, likely boosted by post-holiday discounts,
had a brief impact on the currency market. Markets were
expecting an 0.8 percent contraction in January sales.
[]
U.S. stock investors did not buy on the data with the Dow
Jones industrials falling more than 2 percent in early trade,
as losses on Wall Street mirrored declines in bourses
worldwide.
Meanwhile, the Bank of England's quarterly inflation report
on Wednesday -- where it said it is ready to take
unconventional policy easing steps -- kept sterling under
pressure. The pound was down 1.3 percent at $1.4204 <GBP=>.
A record fall in euro zone industrial production also
strengthened the likelihood the European Central Bank will cut
interest rates next month, something a string of ECB officials
have given heavy hints to over the past week.
In other currencies, the Australian dollar fell 1.2 percent
to US$0.6479 <AUD=>, while the New Zealand dollar was down 1.4
percent at US$0.5178 <NZD=>
(Editing by Gary Crosse)
