December 3, 2019 / 3:23 PM / 2 months ago

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

    * Trump says U.S.-China trade deal might have to wait for
    * 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
    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
    "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
    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                 
 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
 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/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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