FOREX-Yen, Swiss franc advance after new U.S.-China trade wrinkle

  • In US
  • 2019-12-03 15:20:33Z
  • By Reuters

* Trump says U.S.-China trade deal might have to wait for 2020 election * Dollar whacked vs yen, Swiss franc by trade tensions * Yuan hits weakest since late October * Trump impeachment moves gather pace this week * Graphic: World FX rates in 2019 (Recasts, adds new comment, FX table, updates prices, changes byline, dateline; previous LONDON) By Gertrude Chavez-Dreyfuss NEW YORK, Dec 3 (Reuters) - The safe-haven yen and Swiss franc rallied against the dollar on Tuesday as risk appetite eased after U.S. President Donald Trump said a trade deal with China might have to wait until after the 2020 U.S. presidential election. China's offshore yuan fell to its weakest versus the dollar since October after Trump's comments. The surprise statement hit the U.S. dollar broadly as investors dumped the currency, which has tended to rise when optimism over a trade deal has grown. Market participants have long been waiting for a final trade deal, especially as both countries appeared to be nearing a preliminary one. Trump said he had no deadline on agreement with Beijing, sparking a selloff in equities. The news came after Trump on Monday said his administration would impose tariffs on metal imports from Argentina and Brazil on Monday and likely would impose more on a range of French goods. "Markets have been jostled around with Trump's newfound affinity for trade tariffs," said Mazen Issa, senior FX strategist at TD Securities in New York. "In the last 24 hours, he has ignited tensions with Brazil, Argentina, France and China. Nonetheless, risk sentiment has absorbed the latest developments," he added. Analysts pointed out though that Trump's missives on trade came at a time when impeachment developments will come into more focus this week. Trump has been accused of improperly pressuring Ukraine to probe former vice president Joe Biden, a political rival in the 2020 presidential election. The Democratic-controlled House Intelligence Committee is scheduled to vote on its findings later on Tuesday. The matter will then go to the House Judiciary Committee, which will launch its proceedings on Wednesday. "It is perhaps not a coincidence that Trump may be trying to disrupt the news cycle," TD's Issa said. In mid-morning trading, the dollar fell 0.3% against the yen to 108.60 yen. Against the Swiss franc, the dollar also slid, down 0.4% at 0.98752 franc. The dollar index slipped 0.1% overall to 97.743 China's offshore yuan was a big casualty as well, with the with the dollar rising 0.4 percent to 7.0695 yuan, its highest since late October. Moves in currency markets though were broadly contained, with volatility remaining low and investors not appearing to take much fright. Of concern for the dollar's fortunes, however, was Monday's weak U.S. manufacturing report. The U.S. Institute for Supply Management said its index of national factory activity fell to a below-forecast 48.1 in November. Separate data showed construction spending declined in October. The readings surprised economists who had recently raised U.S. growth forecasts for the fourth quarter. ======================================================== Currency bid prices at 9:55 AM (1455 GMT) Description RIC Last U.S. Close Pct Change YTD Pct High Bid Low Bid Previous Change Session Euro/Dollar EUR= $1.1082 $1.1077 +0.05% -3.37% +1.1087 +1.1066 Dollar/Yen JPY= 108.6100 108.9800 -0.34% -1.48% +109.2000 +108.5600 Euro/Yen EURJPY= 120.39 120.72 -0.27% -4.62% +120.9600 +120.3200 Dollar/Swiss CHF= 0.9867 0.9911 -0.44% +0.54% +0.9926 +0.9867 Sterling/Dollar GBP= 1.2998 1.2936 +0.48% +1.89% +1.3009 +1.2931 Dollar/Canadian CAD= 1.3310 1.3308 +0.02% -2.40% +1.3321 +1.3283 Australian/Doll AUD= 0.6837 0.6817 +0.29% -3.01% +0.6862 +0.6815 ar Euro/Swiss EURCHF= 1.0937 1.0982 -0.41% -2.82% +1.0993 +1.0936 Euro/Sterling EURGBP= 0.8527 0.8559 -0.37% -5.09% +0.8565 +0.8513 NZ NZD= 0.6515 0.6501 +0.22% -3.01% +0.6533 +0.6494 Dollar/Dollar Dollar/Norway NOK= 9.1872 9.1638 +0.26% +6.35% +9.1915 +9.1361 Euro/Norway EURNOK= 10.1835 10.1529 +0.30% +2.80% +10.1863 +10.1238 Dollar/Sweden SEK= 9.5363 9.5405 +0.02% +6.39% +9.5517 +9.4938 Euro/Sweden EURSEK= 10.5707 10.5681 +0.02% +2.99% +10.5760 +10.5220 (Reporting by Gertrude Chavez-Dreyfuss; Additional reporting by Tommy Wilkes in London; Editing by Steve Orlofsky)


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