* Dollar index -0.1%, close to two-week low
* Chinese yuan breaks past 7/dollar as risk rally runs
* AUD, NZD edge ahead
* Graphic: World FX rates in 2020 https://tmsnrt.rs/2RBWI5E
By Tom Westbrook
SINGAPORE, July 7 (Reuters) - The dollar nursed losses on Tuesday and riskier currencies added a fraction to galloping gains, after better-than-expected U.S. services data provided the latest boost to confidence in a worldwide economic recovery from the COVID-19 pandemic.
Against a basket of currencies, the dollar huddled near a two-week low. The Chinese yuan picked up where it left off after soaring with runaway Chinese equities on Monday and briefly broke past the 7 per dollar barrier. The Antipodean currencies tagged along for the ride.
The surge came after a front-page editorial in the China Securities Journal, affiliated with state-run Xinhua, said fundamentals laid the foundation for a "healthy bull market".
Data also showed U.S. service industry activity rebounded to almost pre-pandemic levels last month, with the headline figure of 57.1 well ahead of expectations around 50.2.
"Keep buying forever," said Imre Speizer, FX analyst at Westpac in Auckland, only half in jest as he forecast the New Zealand dollar to tack on more than a cent over the next week or so.
"The bigger picture is that economies are back to something that looks like a V-shape again," he said. "And the U.S. dollar, because it's a safe haven, goes down if sentiment is strong."
The kiwi <NZD=D3 rose as much as 0.3% to a one-month high of $0.6580, testing resistance around $0.6585. Speizer expects it could reach $0.67 if sentiment holds. The Australian dollar was steady at $0.6976.
Both are making a renewed tilt at the top of the ranges they have held for weeks, taking cues from ebullient stock markets.
"The worst is likely over, but a swift and steady recovery cannot be taken as the base case," said Terence Wu, a strategist at Singapore's OCBC Bank.
ROLL BACKS, NO ROLL OVER
The push higher in riskier currencies this week comes despite the rapid spread of the coronavirus casting doubts over the global recovery.
Florida's greater Miami area became the latest U.S. hot spot to roll back its reopening, ordering all restaurant dining closed on Monday as COVID-19 cases surged nationwide by the tens of thousands and the U.S. death toll topped 130,000.
Australia shuts the border between its two most populous states at one minute before midnight on Tuesday, as it attempts to contain a coronavirus outbreak in the city of Melbourne.