July 16, 2018 / 8:17 PM / a month ago

FOREX-Dollar eases as investors reset positions ahead of Powell testimony

    * U.S. retail sales rise in June
    * Investors look to Powell testimony
    * Graphic: World FX rates in 2018 tmsnrt.rs/2egbfVh

 (Adds comment; updates prices)
    By Gertrude Chavez-Dreyfuss
    NEW YORK, July 16 (Reuters) - The dollar fell on Monday as
investors pared long bets on the greenback and rebalanced their
positions ahead of Federal Reserve Chairman Jerome Powell's
first congressional testimony.
    Powell will testify on the economy and monetary policy
before the U.S. Senate Banking Committee on Tuesday, followed by
testimony on Wednesday to the House of Representatives Financial
Services Committee. He is likely to reiterate the Fed's gradual
monetary policy tightening, although any suggestion of caution
on trade could unravel the market's appetite for risk, analysts
said.
    Powell "is very scripted and to the point and doesn't really
shoot off the hip a lot," said John Doyle, vice president of
dealing and trading at Tempus Consulting in Washington. "So I
think what he says is going to be fairly consistent for those
two days, and there won't be any kind of major hint or slip-up
or anything like that."
    Doyle said he will be interested to see if Powell makes any
comments on global trade tensions and how that would affect the
outlook for interest rates.
    The dollar has benefited from expectations of further
interest rate increases this year as well as a growing belief
that the United States is better placed than its major rivals to
withstand a potential disruption in global trade.
    Outstanding U.S. dollar bets are at their highest levels
since March 2017, with the latest weekly data showing yet
another increase in positions. Speculators were net long dollars
for a fourth consecutive week, after being net short for 48
straight weeks.
    In late trading, the dollar fell 0.2 percent against a
basket of six major currencies to 94.526, sliding for a
second straight session.
    The dollar briefly pared losses after data showed U.S.
retail sales rose 0.5 percent in June, as households boosted
purchases of automobiles and a range of other goods.

    The uptrend on the dollar remained intact. Since hitting a
more than three-year low against a basket of major currencies in
February, the dollar has gained nearly 8 percent.
    The dollar's growing inverse correlation with global risk
appetite has also fueled a near 6 percent rise in the greenback
over the last three months. 
    Monday's bounce in European stocks, led by strong results
from Deutsche Bank, snapped that trend.
    A rebound in global risk appetite on Monday, despite some
tepid Chinese economic data, dampened fears about the escalating
trade conflict between Beijing and Washington and boosted
higher-yielding currencies.
    The euro, meanwhile, rose 0.2 percent against the
dollar, to $1.1708, after weakening half a percent last week.
    
========================================================
    Currency bid prices at 3:57PM (1957 GMT)
 Description      RIC         Last           U.S. Close  Pct Change     YTD Pct     High Bid    Low Bid
                                              Previous                   Change                 
                                              Session                                           
 Euro/Dollar      EUR=        $1.1711        $1.1685     +0.22%         -2.38%      +1.1725     +1.1676
 Dollar/Yen       JPY=        112.2800       112.3600    -0.07%         -0.35%      +112.5500   +112.2100
 Euro/Yen         EURJPY=     131.49         131.27      +0.17%         -2.73%      +131.7000   +131.1000
 Dollar/Swiss     CHF=        0.9965         1.0016      -0.51%         +2.28%      +1.0024     +0.9964
 Sterling/Dollar  GBP=        1.3233         1.3232      +0.01%         -2.06%      +1.3292     +1.3218
 Dollar/Canadian  CAD=        1.3139         1.3159      -0.15%         +4.47%      +1.3162     +1.3109
 Australian/Doll  AUD=        0.7420         0.7423      -0.04%         -4.88%      +0.7442     +0.7408
 ar                                                                                             
 Euro/Swiss       EURCHF=     1.1670         1.1703      -0.28%         -0.16%      +1.1714     +1.1671
 Euro/Sterling    EURGBP=     0.8847         0.8831      +0.18%         -0.41%      +0.8854     +0.8816
 NZ               NZD=        0.6768         0.6763      +0.07%         -4.49%      +0.6793     +0.6759
 Dollar/Dollar                                                                                  
 Dollar/Norway    NOK=        8.0987         8.1127      -0.17%         -1.32%      +8.1245     +8.0825
 Euro/Norway      EURNOK=     9.4829         9.4803      +0.03%         -3.71%      +9.4935     +9.4711
 Dollar/Sweden    SEK=        8.8176         8.8820      -0.55%         +7.51%      +8.8937     +8.8114
 Euro/Sweden      EURSEK=     10.3259        10.3829     -0.55%         +4.95%      +10.3857    +10.3230
 
    
 (Reporting by Gertrude Chavez-Dreyfuss; Additional reporting by
James Thorne; Editing by Jonathan Oatis and Leslie Adler)
  
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