* Graphic: World FX rates in 2019 http://tmsnrt.rs/2egbfVh
* Sterling limps into Asian trading after big fall
* Weak data knocks euro lower
* Brexit vote could set tone for global financial markets
By Stanley White
TOKYO, Sept 3 (Reuters) - Sterling wallowed near a more than
two-year low on Tuesday on growing investor worries about a
"no-deal Brexit" as rival British lawmakers fought for control
over negotiations to leave the European Union.
The euro fell to the lowest in more than two years as weak
economic data from the EU underscored expectations for the
European Central Bank to ease monetary policy at a meeting next
week.
The yuan will come into focus during Asian trading after it
slipped to a record low versus the dollar in offshore trade due
to fading hopes for a resolution to the U.S.-China trade war.
The pound is likely to remain under pressure ahead of a vote
in Britain's parliament about Brexit later on Tuesday, the
outcome of which could trigger an early election and Britain's
exit from the EU without trading agreements.
A messy exit from the EU is certain to weaken the pound, but
it could roil other currencies as investors adjust their
positions to exit trades in riskier assets.
"The pound is being sold all over the place, because the
political risk has forced us to recognise that a no-deal Brexit
is possible," said Junichi Ishikawa, senior foreign exchange
strategist at IG Securities in Tokyo.
"At this point, I see no reason to stay long in sterling."
Sterling traded at $1.2063 GBP=D3 , flat so far in Asian
trading but close to the lowest in more than two years. The
pound tumbled 0.8% on Monday, its biggest decline in more than
three weeks.
The euro was flat at 90.91 pence EURGBP=D3 , holding onto a
0.7% gain on Monday.
A group of lawmakers will put forward a vote on Tuesday on
whether to seize control of the parliamentary agenda to try to
force a three-month delay to Britain's EU exit deadline of Oct.
31. Johnson raised the stakes on Monday, however, effectively
turning it into a confidence vote by making it clear that if the
government was defeated, it would hold a vote on Wednesday to
approve an early election, most likely to be held on Oct. 14.
Some politicians have warned that a no-deal Brexit should be
avoided at all costs, because leaving the EU without trading
agreements in place could cause economic turmoil.
Elsewhere in currency markets, the dollar index =USD rose
0.27% on Tuesday to 99.082, reflecting weakness in other major
currencies. U.S. financial markets were closed on Monday for a
public holiday.
In the offshore market, the yuan CNH=D3 traded at 7.1940
per dollar, close to its weakest since international trading in
the currency began in 2010.
The yuan weakened after Bloomberg News reported that Chinese
and U.S. officials are struggling to agree a schedule for a
round of trade negotiations that were expected this month.
The United States and China have been locked in a bitter
trade dispute for more than a year, which is causing the global
economy to slow.
The euro EUR= fell to $1.0954 in Asia on Tuesday, which is
the lowest since May 2017. The common currency fell 0.2% on
Monday. Sentiment for the euro had already weakened after it
broke below the key $1.1000 level last week.
The euro weakened further after a survey on Monday showed
European manufacturing contracted for seven straight months.
The Australian dollar fetched $0.6712 AUD=34 , down 0.07%
in early trade.
The Reserve Bank of Australia is expected to keep its cash
rate at a record low of 1% on Tuesday, though it will likely cut
again two more times to boost inflation and support a stuttering
economy, a Reuters poll showed.