* Graphic: World FX rates in 2019 http://tmsnrt.rs/2egbfVh
By Daniel Leussink
TOKYO, May 28 (Reuters) - The dollar nudged up against its
key rivals in early trade on Tuesday as investors waited on more
catalysts after the European Union parliamentary elections
showed a polarisation of the 28-member block.
The yen was in a holding pattern as U.S. President Donald
Trump, who is visiting Japan, is seen putting pressure on Tokyo
to reduce the nation's large trade surplus with the United
States.
Many of the currency pairs hugged recent ranges, as activity
thinned out overnight with stock exchanges in the United States
and Britain closed for market holidays.
The euro struggled following remarks from two euro zone
officials that the European Commission is likely to start
disciplinary steps against Italy on June 5 over the country's
rising debt and structural deficit levels, which break European
Union rules. Against a basket of six peers, the dollar gained 0.15% to
97.746 .DXY , trading about 0.6% off a two-year high of 98.371
hit on Thursday. The index is still up 1.65% for the year.
The euro was unchanged at $1.1192 EUR= after bouncing from
a 1-1/2-week high of $1.1215 overnight following the outcome of
European parliamentary elections.
Pro-European parties retained a firm grip on the EU
parliament, provisional results from the bloc's elections showed
on Monday, though euroskeptic opponents saw strong
gains. "There is a polarization of the European parliament which is
a kind of representation of the overall European political
situation," said Masafumi Yamamoto, chief currency strategist at
Mizuho Securities. "That will be broadly negative for the euro."
Yamamoto said the news of possible disciplinary steps
against Italy over its national debt hurt the euro, though the
market reaction was limited due to the U.S. and UK holidays.
Against the yen, the dollar was down a shade at 109.52 yen
JPY= , about 0.5% above a three-month low of 109.02 yen touched
three weeks ago.
The dollar's rise against the Japanese currency has been
limited as Trump sought to pressure Japan to take measures to
reduce its trade surplus with the world's largest economy.
Trump told a news conference with Japanese Prime Minister
Shinzo Abe on Monday that he wanted exports to be put on fair
footing in Japan through the removal of trade
barriers. Elsewhere in the foreign exchange market, the Australian
dollar was up nearly 0.1% at $0.6920 AUD=D4 , about 0.8% above
a four-month low last touched on Thursday last week.
Bitcoin BTC=BTSP , which on Monday had touched $8,939.18,
its highest level in more than a year, was largely unchanged at
$8,779.62. The cryptocurrency topped $8,000 for the first time
since July 2018 on May 13.
(Editing by Shri Navaratnam)