May 1, 2020 / 9:39 AM / 24 days ago

FOREX-Chinese yuan falls on US tariff threat; Australian dollar sinks

* Yuan has worst day since March 25

* Euro relatively stable, sterling gives back gains

* Graphic: World FX rates in 2019 (Recasts, adds new comment, latest news)

By Olga Cotaga

LONDON, May 1 (Reuters) - The Chinese yuan fell to a one-month low versus the dollar on Friday, a day after U.S President Donald Trump accused China mishandling the outbreak of the novel coronavirus and threatened new tariffs on Beijing.

Trump said on Thursday he believed the virus may have originated in a virology lab in Wuhan, the Chinese city where the outbreak began. The Chinese state-backed Wuhan Institute of Virology has dismissed the allegations, and other U.S. officials have downplayed their likelihood.

The Chinese yuan fell in the offshore market by 0.7% to 7.1350 versus the U.S. currency, its lowest since April 2 . On Friday the yuan fell to its lowest since March 25.

“Given the scale of the COVID-19 impact there is certainly a high risk of geopolitical tensions escalating considerably as lockdowns reverse,” said Derek Halpenny, head of research at MUFG.

“This would clearly be another hit to global trade that would add a layer of dollar support going forward,” Halpenny said.

Another metric of market distress - the Australian dollar - fell by more than 1% to 0.6438, its weakest since Tuesday .

The Canadian dollar also fell, by 0.5% to 1.4016 against the greenback.

Analysts attributed the moves to poor equity performance in the United States.

“The late day fall in the S&P 500 diminished the market’s gains for the month and turned April from the best month since October 1974 to the best month since January 1987,” said Marshall Gittler, a forex analyst at broker BDSwiss.

The euro stabilised against the U.S. dollar, having rallied the day before to a two-week high on month-end flows and on news that the European Central Bank will make loans to banks even cheaper.

It was last up 0.2% at $1.0977.

Much of Europe was closed on Friday for the International Workers’ Day, as was much of Asia, but a new month brings a new set of worries to investors as coronavirus infections rise to 3.3 million globally, claiming more than 230,000 lives.

The U.S. dollar was down against the Japanese yen as well, trading down 0.3% at 106.88 yen.

Elsewhere, sterling gave up some of the gains it made the day before, trading down 0.2% against the dollar at $1.2566 and by 0.4% against the euro at 87.34 pence .

Reporting by Olga Cotaga Editing by Raissa Kasolowsky

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