* Graphic: World FX rates in 2020 https://tmsnrt.rs/2RBWI5E
* Dollar grinds lower against many currencies
* Improving risk appetite draws funds from dollar
* Traders closely monitoring moves in yuan
By Stanley White
TOKYO, Nov 26 (Reuters) - The dollar was on the defensive on Thursday as downbeat U.S. economic data and optimism about coronavirus vaccines prompted investors to seek out riskier assets tied to global commodities and emerging markets.
The British pound traded near a more than two-month high against the dollar as investors awaited details on trade talks between Britain and the European Union this week.
The dollar's fall has been so rapid that it could rebound in the short term, market watchers said, but some investors still expect a decline over the longer term as they shift positions in expectation that the coronavirus outbreak will wane next year.
"A China-led recovery in the global economy and commodities should benefit commodity currencies," said Masafumi Yamamoto, chief currency strategist at Mizuho Securities in Tokyo.
"The outlook is good, but we are reaching levels where authorities might feel some concern. Other emerging market currencies with good fundamentals should benefit."
Against the euro EUR=EBS , the dollar stood at $1.1926, close to its weakest in more than two months.
Sterling GBP=D3 bought $1.3387, which is near its strongest level since Sept. 2. The pound held steady at 89.06 pence per euro EURGBP=D3 .
The dollar was little changed at 104.31 yen JPY=D3 .
Investors have rushed to riskier currencies and emerging-market assets in recent weeks after positive data on COVID-19 vaccine efficacy and signs of stability in U.S. politics, which has weighed broadly on the dollar.
Sentiment for the greenback took a hit after data on Wednesday showed weekly U.S. jobless claims rose more than expected and personal incomes fell. economists said more job losses are likely as many U.S. states reinforce restrictions on businesses to curb a spread of coronavirus infections.
The dollar index =USD against a basket of six other currencies was near the lowest in more than two months.
Trading in the dollar was subdued because U.S. financial markets are closed later on Thursday for the Thanksgiving holiday.
Bitcoin BTC=BTSP , the most popular cryptocurrency, fell to $17,895 after a failed attempt to breach its record high of $19,666 from December 2017. Australian dollar AUD=D3 traded near its highest since September, supported by improving risk appetite and strong Chinese demand for the commodities that Australia exports.
The New Zealand dollar NZD=D3 traded near its strongest level in more than two years.
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Currency bid prices at 2:44 PM (0544 GMT) Description
RIC
Last
U.S. Close Pct Change
YTD Pct
High Bid
Low Bid
Previous
Change
Session
Euro/Dollar
EUR=EBS
$1.1926
$1.1914
+0.10%
+6.38%
+1.1930
+1.1915 Dollar/Yen
JPY=D3
104.3150
104.4200
-0.06%
-3.92%
+104.4150 +104.3300 Euro/Yen
EURJPY=
124.41
124.43
-0.02%
+2.02%
+124.4900 +124.3500 Dollar/Swiss
0.9070
0.9081
-0.13%
-6.28%
+0.9082
+0.9068 Sterling/Dollar GBP=D3
1.3387
1.3386
+0.01%
+0.94%
+1.3397
+1.3382 Dollar/Canadian CAD=D3
1.3000
1.3007
-0.04%
+0.08%
+1.3007
+1.2992 Aussie/Dollar
AUD=D3
0.7356
0.7365
-0.11%
+4.85%
+0.7374
+0.7356 NZ
NZD=D3
0.7000
0.7007
-0.10%
+4.03%
+0.7014
+0.6997 Dollar/Dollar
All spots FX= Tokyo spots AFX= Europe spots EFX= Volatilities FXVOL= Tokyo Forex market info from BOJ TKYFX