FOREX-Yen rises on renewed jitters about U.S.-China after Huawei report

* Graphic: World FX rates in 2019 http://tmsnrt.rs/2egbfVh
* Markets on edge about U.S.-China trade friction
* Safe-haven flows benefit yen and gold
* Political uncertainty surrounds Brexit

By Stanley White
TOKYO, Aug 9 (Reuters) - The yen rose on Friday on renewed
concerns about the U.S.-China trade dispute after a report that
the White House is delaying a decision on allowing U.S.
companies to do business with China's Huawei Technologies.
The Bloomberg report on Huawei, a telecoms equipment maker
that Washington has accused of espionage and stealing
intellectual property, sparked a flurry of risk-off trades which
also pushed up gold prices and sent U.S. stock futures lower.
The offshore yuan was stable versus the dollar in early
trade after an alarming early week slide, but it will be closely
watched as traders eye Beijing's response to escalating trade
tensions.
The pound traded near a two-year low versus the euro after a
media report said new Prime Minister Boris Johnson is preparing
to hold an election after the Oct. 31 deadline for Britain to
leave the European Union.
Increased uncertainty about the standoff between the United
States and China, as well as uncertainty about Brexit, is likely
to continue to support safe-haven currencies and risk-off trades
in coming weeks.
"The news about Huawei triggered the rise in the yen," said
Junichi Ishikawa, senior foreign exchange strategist at IG
Securities in Tokyo.
"U.S. stocks are trying to stage a recovery, but this is a
reminder that the U.S.-China trade dispute remains a risk, and
this risk is not receding. In this environment, it is easy for
the yen and gold to go higher."
The dollar fell 0.2% to 105.84 yen JPY=EBS , on course for
its second weekly decline. If the dollar manages to break its
Aug. 7 low of 105.50 yen, it would next target 105.00 yen,
Ishikawa said.
Yen traders were largely unfazed by data showing Japan's
economy grew much more than expected in April-June, as robust
private consumption and business investment offset the hit to
exports from cooling global demand. The data offers some relief for the Bank of Japan, which is
under pressure to follow other central banks and ramp up
stimulus to head off heightening global risks.
The dollar index =USD , which measures the greenback versus
a basket of six major currencies, was little changed at 97.566.
The offshore yuan traded at 7.0816 per dollar CNH= , little
changed in Asian trade.
Spot gold rose 0.3% in Asian trading to $1,500.80 per ounce,
near the highest in six years, while S&P e-mini futures ESc1
traded 0.5% lower.
The White House delayed its decision on Huawei after China
said it would halt purchases of U.S. agricultural products,
Bloomberg reported, highlighting the tit-for-tat nature of the
trade dispute between the world's two-largest economies.
The trade war has entered new territory after U.S. President
Donald Trump said he will impose more tariffs on Chinese imports
from Sept. 1. China let the yuan slide through a key support
level on Monday to an 11-year low and hours later the U.S.
Treasury Department labelled China a currency manipulator.
There are growing concerns the rapid deterioration in
U.S.-China relations will place additional strain on an already
fragile global economy.
Sterling traded at $1.2145 GBP=D3 , little changed on the
day but on course for a fourth consecutive week of declines.
Against the euro, Sterling was quoted at 92.10 pence
EURGBP=D4 , near a two-year low of 92.65 pence.
The Financial Times, citing unidentified senior aides to the
prime minister, reported that Johnson would hold an election in
the days following Brexit if lawmakers sunk his government with
a vote of no-confidence.
Johnson has said he will take Britain out of the European
Union on Oct. 31 even if that means leaving without a transition
agreement.