FOREX -Euro tumbles to lowest since mid-2017 as ECB restarts stimulus

    * ECB delays rate hike, readies to lend more to banks
    * Latest ECB move knocks neighboring European currencies 
    * Dollar index rallies to highest since December
    * Canadian, Aussie dollar hover at two-month lows
    * Graphic: World FX rates in 2019

 (Updates market action, changes dateline, previous LONDON)
    By Richard Leong
    NEW YORK, March 7 (Reuters) - The euro sank on Thursday to
its lowest against the dollar since June 2017 after the European
Central Bank postponed the timing of its first post-crisis rate
hike to 2020 at the earliest and launched a new round of cheap
loans to banks.
    The ECB's decision to tweak its forward guidance on rates
was a surprise for many investors. The central bank also cut its
growth and inflation forecasts through 2021.
    "The ECB has no choice," said Joseph Trevisani, senior
analyst at FX Street in New York. "There are a lot of internal
problems which are impediments to growth."
    Anemic domestic demand and political tensions will unlikely
be resolved by an easy ECB policy stance and would keep downward
pressure on the euro, analysts said.
    Currencies of European countries not part of the euro zone,
such as the Swedish crown and Hungarian forint, fell hard after
the ECB's decision, which is aimed at battling deteriorating 
regional business and consumer activities, analysts said.
    On the other hand, the greenback reached a new 2019 high
against a basket of currencies that includes the euro as traders
bet the United States would fare better than Europe in the
coming months despite some soft patches in the U.S. economy.
    The euro sagged to $1.1206, its lowest level since
mid-2017. It was last 0.81 percent lower at $1.1216 in midday
U.S. trading. 
    The euro is at risk of falling to $1.10 in the coming weeks,
analysts said. 
    The Swedish crown fell to its weakest since Dec.
15, 2016 at 9.4185 per dollar. It was down 0.62 percent at
10.581 per euro, Reuters data showed.
    The Hungarian forint shed 0.99 against the dollar and
dipped 0.1 percent against the euro.
    The ICE index that tracks the dollar against a basket of six
major currencies was up 0.63 percent at 97.483 after
touching 97.499, which was its highest since Dec. 17.
    "I don't think you will get much more on the upside," Aaron
Hurd, senior portfolio manager in the currency group at SSGA in
Boston, said of the greenback. "It will likely stay in a range."
    Among other G10 currencies, the Canadian and Australian
dollars hovered at two-month lows after investors bet their
central banks would ease monetary policy as their economies
    The Aussie was down 0.06 percent at $0.7028, while
the loonie was up 0.10 percent at C$1.3428.
    Currency bid prices at 12:15PM (1715 GMT)
 Description      RIC         Last           U.S. Close  Pct Change     YTD Pct     High Bid    Low Bid
                                              Previous                   Change                 
 Euro/Dollar      EUR=        $1.1212        $1.1305     -0.82%         -2.24%      +1.1321     +1.1207
 Dollar/Yen       JPY=        111.5700       111.7500    -0.16%         +1.18%      +111.8500   +111.4900
 Euro/Yen         EURJPY=     125.11         126.35      -0.98%         -0.88%      +126.4300   +125.0800
 Dollar/Swiss     CHF=        1.0108         1.0048      +0.60%         +3.00%      +1.0114     +1.0036
 Sterling/Dollar  GBP=        1.3105         1.3169      -0.49%         +2.73%      +1.3185     +1.3090
 Dollar/Canadian  CAD=        1.3423         1.3440      -0.13%         -1.57%      +1.3448     +1.3413
 Australian/Doll  AUD=        0.7028         0.7032      -0.06%         -0.30%      +0.7051     +0.7022
 Euro/Swiss       EURCHF=     1.1335         1.1364      -0.26%         +0.72%      +1.1368     +1.1320
 Euro/Sterling    EURGBP=     0.8554         0.8583      -0.34%         -4.78%      +0.8625     +0.8554
 NZ               NZD=        0.6763         0.6767      -0.06%         +0.68%      +0.6791     +0.6764
 Dollar/Norway    NOK=        8.7465         8.6634      +0.96%         +1.25%      +8.7531     +8.6563
 Euro/Norway      EURNOK=     9.8105         9.7968      +0.14%         -0.96%      +9.8238     +9.7828
 Dollar/Sweden    SEK=        9.4359         9.2986      +0.63%         +5.27%      +9.4429     +9.2886
 Euro/Sweden      EURSEK=     10.5820        10.5162     +0.63%         +3.10%      +10.5855    +10.5059

 (Additional reporting by Tommy Wilkes in LONDON
Editing by Raissa Kasolowsky and Susan Thomas)