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FOREX-Dollar keeps safe-haven bid amid trade 'headline fatigue'

Published 22/11/2019, 01:51
© Reuters.  FOREX-Dollar keeps safe-haven bid amid trade 'headline fatigue'
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* Greenback clings to overnight gains, trade news awaited

* Europe, U.S. PMIs eyed for latest read on global economy

* Graphic: World FX rates in 2019 http://tmsnrt.rs/2egbfVh

By Tom Westbrook

SINGAPORE, Nov 22 (Reuters) - The dollar held overnight

gains on Friday, as investors clung to the safe-haven pending

developments in Sino-U.S. trade negotiations and amid a growing

skepticism about reports of progress in the talks.

Movements were slight as investors also looked to a slew of

global manufacturing surveys published later in the day for

clues on how deeply the U.S.-China trade dispute is hurting the

world's economy.

The greenback crept higher against the Japanese yen JPY=

to 108.58 yen and was steady against the euro EUR= at $1.1064.

Antipodean currencies were flat on the dollar, with the Aussie

AUD=D3 buying $0.6789 and the kiwi NZD=D3 $0.6404.

Against a basket of currencies .DXY the dollar last

treaded at 97.993.

"Trade is the elephant in the room," said Ray Attrill,

National Australia Bank's head of FX strategy, though he added

that "headline fatigue has set in," limiting volatility in the

market's reaction to new information.

Investors had earlier factored in the prospect that a

partial truce could be agreed at a mid-November summit in

Santiago. But that summit was cancelled and the path forward is

now unclear.

China will try hard to resolve the dispute, Commerce

ministry spokesman Gao Feng told reporters on Thursday.

The Wall Street Journal also reported that top U.S.

negotiators had been invited to Beijing for a new round of

face-to-face talks, further raising hopes and risk appetite.

However trade experts and people close to the White House

told Reuters that negotiations could slide into next year.

"With the constant barrage of seemingly contradictory stuff,

the market's given up trying to second-guess the next headline,"

said Attrill. "We'll trade it once we know what's happening."

China's yuan, which is highly sensitive to trade news, was

stable at 7.0303 per dollar in offshore trade CNH= .

Elsewhere, the rising dollar kept the British pound GBP=

below $1.30, while a manifesto from the British Labour Party

setting out radical plans to raise tax and nationalise

infrastructure also weighed. Sterling last traded at $1.2916.

Purchasing managers indexes are due for Germany, the

Eurozone, Britain and the United States later on Friday,

offering a reading on the globe's battered manufacturing sector.

"The current narrative has global growth slowing to year

end," said Michael McCarthy, chief markets analyst at brokerage

CMC Markets in Sydney. "So the real potential is if we see

surprises on the upside...it could have direct impact on

Euro-U.S. dollar."

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