* CNBC reports that China is pessimistic about tariffs
* Sterling gains on hopes of Brexit deal
(New throughout, updates prices, market activity and comments
to U.S. market open, new byline, changes dateline, previous
LONDON)
By Karen Brettell
NEW YORK, Nov 18 (Reuters) - The safe haven Japanese yen
gained on Monday after a media report dashed fresh hopes that
the United States and China are close to reaching a trade deal.
CNBC reported that China is pessimistic about reaching a
trade deal due to U.S. President Donald Trump's reluctance to
roll back tariffs. It came after Chinese state media Xinhua said on Sunday that
China and the United States had "constructive talks" on trade in
a high-level phone call on Saturday. “I think the market is overreacting to this,” said Mazen
Issa, senior FX strategist at TD Securities in New York. “There
was nothing substantive that came out that suggested the deal is
off or on, it's just the ebb and flow” of the news each day.
Investors are looking for signs that tariffs imposed on each
country's goods will be rolled back, as they are viewed as
harming global economic growth.
Another round of U.S. tariffs on Chinese goods is scheduled
to take effect on Dec. 15.
The yen JPY= gained to 108.64, from 109.02 before the CNBC
report was released.
The euro EUR= reached at 10-day high against the greenback
at 1.1063.
The single currency has rebounded from a more than two-year
low of 1.0877 on Oct. 1 on optimism a trade deal will be
signed.
"Market participants remain optimistic that a partial
U.S.-China trade deal will be signed soon and have welcomed
tentative signs of economic improvement outside of the U.S.,
especially in the euro zone, both of which are eroding the
relative appeal of the U.S. dollar," Lee Hardman, currency
analyst at MUFG, said.
Still analysts say that the European and global economies
need to show more strength to sustain a euro rally.
“One of the things the euro is, is a pro-cyclical or growth
currency and so when global growth performs well you tend to see
the euro perform well, but we're not there yet,” said TD's Issa.
Sterling, meanwhile, was boosted by expectations that the
Conservative (Tory) Party could win a majority in the Dec. 12
election.
It was also supported by British Prime Minister Boris
Johnson saying that all Tory candidates in the election have
pledged to back his Brexit deal, which could open the door to
getting the agreement through parliament. Currency bid prices at 9:42AM (1442 GMT)
Description RIC Last U.S. Close Pct Change YTD Pct High Bid Low Bid
Previous Change
Session
Euro/Dollar EUR= $1.1063 $1.1050 +0.12% -3.54% +1.1068 +1.1050
Dollar/Yen JPY= 108.6400 108.7300 -0.08% -1.47% +109.0600 +108.6300
Euro/Yen EURJPY= 120.19 120.20 -0.01% -4.78% +120.6800 +120.1000
Dollar/Swiss CHF= 0.9880 0.9897 -0.17% +0.67% +0.9914 +0.9882
Sterling/Dollar GBP= 1.2963 1.2899 +0.50% +1.61% +1.2984 +1.2901
Dollar/Canadian CAD= 1.3223 1.3221 +0.02% -3.04% +1.3235 +1.3210
Australian/Doll AUD= 0.6805 0.6819 -0.21% -3.46% +0.6822 +0.6799
Euro/Swiss EURCHF= 1.0931 1.0937 -0.05% -2.87% +1.0962 +1.0931
Euro/Sterling EURGBP= 0.8534 0.8565 -0.36% -5.01% +0.8566 +0.8523
NZ NZD= 0.6396 0.6399 -0.05% -4.78% +0.6412 +0.6391
Dollar/Dollar
Dollar/Norway NOK= 9.1201 9.0898 +0.33% +5.57% +9.1330 +9.0642
Euro/Norway EURNOK= 10.0914 10.0410 +0.50% +1.87% +10.0988 +10.0272
Dollar/Sweden SEK= 9.6394 9.6390 +0.09% +7.54% +9.6490 +9.6195
Euro/Sweden EURSEK= 10.6654 10.6557 +0.09% +3.91% +10.6697 +10.6430
(Editing by Karen Brettell; Additional reporting by Olga Cotaga
in London; Editing by Steve Orlofsky)