FOREX-Dollar steadies as angst over Trump's stimulus stance fades

* Graphic: World FX rates in 2020 https://tmsnrt.rs/2RBWI5E
* Euro, sterling recoup some losses
* Asian stock rise, Europe bourses open flat
* Fed speakers to comment on economy later in day

By Julien Ponthus
LONDON, Oct 7 (Reuters) - The dollar steadied on Wednesday,
ticking down against most currencies after an initial jump
triggered by U.S. President Donald Trump cancelling stimulus
talks with Democrat lawmakers, a move which increased demand for
safe-haven assets.
Trump's surprise decision to call off stimulus talks until
after the Nov. 3 presidential election initiated a selling spree
on Wall Street with investors bracing for fresh downside risks
for an already shaky U.S. economy.
The initial shock from the announcement eased when the U.S.
President later asked Congress to extend $25 billion in new
payroll assistance to U.S. passenger airlines.
Sentiment improved overnight in Asia where markets hit a
two-week high and U.S. stock futures made their way back to
positive territory.
All in all, analysts said the renewed uncertainty over
stimulus would encourage investors to trade riskier currencies
cautiously.
"This is set to reinstate caution in markets about the
prospects of near-term economic recovery, helping the safe haven
dollar and keeping cyclical FX soft", ING strategists wrote in a
morning note.
In early trading in Europe, the dollar was last quoted at
$1.1754 per euro EUR=D3 , down 0.18% after a 0.4% gain against
the common currency during the previous session.
The British pound GBP=D3 was quoted at $1.2915, up 0.36%
after losing 0.86% on Tuesday.
The Australian dollar AUD=D3 edged up 0.57% to $0.7142
after tumbling by more than 1.1% on Tuesday.
Traders say the Aussie faces more downside risks due to
expectations that the Reserve Bank of Australia's next move is
to cut rates and buy more government debt. The increased risk aversion, however, did not move the
dollar much against the yen, which was last quoted at 105.75
JPY=D3 , because both currencies tend to be bought during times
of uncertainty, analysts say.
Highlighting the potential danger of no additional stimulus
funds to prop up the economy, Federal Reserve Chair Jerome
Powell on Tuesday warned that the U.S. economy could slip into a
downward spiral if the coronavirus is not effectively controlled
and called for more economic assistance. Traders will look to minutes from the Fed's most recent
meeting and comments from several Fed speakers later Wednesday
for further signs of how central bankers view the outlook.