April 17, 2018 / 4:00 PM / 5 months ago

FOREX-Dollar gains from 3-week low as euro, sterling fall

    * Euro eases on declining German investor morale
    * Swiss franc drops to lowest since January 2015
    * Yen flat against the dollar
    * Sterling falls vs dollar as UK worker pay lags inflation
    * Graphic: World FX rates in 2018 tmsnrt.rs/2egbfVh

 (Recasts, updates prices, adds comments, changes byline,
dateline)
    By Gertrude Chavez-Dreyfuss
    NEW YORK, April 17 (Reuters) - The dollar rose from a
three-week low on Tuesday, helped by falls in the euro and
sterling, even as investors remained cautious about the
greenback because of tension in the Middle East and a U.S. trade
dispute with China.
    "The weakness in the euro and sterling is mainly driving the
dollar higher at this point, although there are other factors as
well," said Omer Esiner, chief market analyst at Commonwealth
Foreign Exchange in Washington.
    Stronger-than-expected U.S. housing starts in March also
helped the dollar, as did a positive reading on industrial
production.
    The dollar earlier fell to a three-week low against a
currency basket after President Donald Trump said on Monday that
 China and Russia were trying to devalue their currencies.
Investors interpreted Trump's comments as a nod to having a
weaker currency.
    Treasury Secretary Steve Mnuchin, however, clarified Trump's
comments in an interview with CNBC, saying the U.S. president's
remarks were a warning to those countries against devaluing
their currencies. 
    "The dollar found support from comments from Treasury
Secretary Mnuchin, who dialed back some of the president's
comments from yesterday," Esiner said.
    The dollar index, as a result, advanced 0.2 percent to
89.615.
    The euro, meanwhile, fell 0.3 percent to $1.2346,
after a monthly survey showed morale among German investors was
deteriorating.
    Sterling was also down, slipping 0.2 percent to $1.4314
, hurt by data showing British workers' pay is still
rising by less than inflation despite the lowest unemployment
rate since 1975.
    "Today's news did not help the (sterling) bulls as it
clearly showed that the UK economy is slowing, which will make
the task of normalization more difficult for the BoE (Bank of
England)," said Boris Schlossberg, managing director of FX
strategy at BK Asset Management in New York. 
    Elsewhere, the Swiss franc fell to its lowest versus the
euro since the Swiss National Bank scrapped its currency peg in
January 2015.   
    
     Against the yen, the dollar was flat at 107.11 yen,
off a seven-week high of 107.78 yen touched on Friday, before a
meeting between Trump and Japanese Prime Minister Shinzo Abe on
Tuesday and Wednesday.
    Tokyo is eager to avoid being pushed into talks on a two-way
free-trade agreement aimed not only at market access but at
monetary and currency policies. 
    
    ========================================================
    Currency bid prices at 11:18AM (1518 GMT)
 Description      RIC         Last           U.S. Close  Pct Change     YTD Pct     High Bid    Low Bid
                                              Previous                   Change                 
                                              Session                                           
 Euro/Dollar      EUR=        $1.2345        $1.2378     -0.27%         +2.91%      +1.2413     +1.2338
 Dollar/Yen       JPY=        107.1200       107.1000    +0.02%         -4.93%      +107.2000   +106.8900
 Euro/Yen         EURJPY=     132.25         132.58      -0.25%         -2.17%      +132.7700   +132.2100
 Dollar/Swiss     CHF=        0.9653         0.9598      +0.57%         -0.92%      +0.9667     +0.9582
 Sterling/Dollar  GBP=        1.4313         1.4335      -0.15%         +5.93%      +1.4376     +1.4306
 Dollar/Canadian  CAD=        1.2557         1.2563      -0.05%         -0.16%      +1.2579     +1.2540
 Australian/Doll  AUD=        0.7771         0.7778      -0.09%         -0.38%      +0.7791     +0.7761
 ar                                                                                             
 Euro/Swiss       EURCHF=     1.1918         1.1880      +0.32%         +1.96%      +1.1931     +1.1882
 Euro/Sterling    EURGBP=     0.8624         0.8633      -0.10%         -2.92%      +0.8647     +0.8620
 NZ               NZD=        0.7334         0.7361      -0.37%         +3.50%      +0.7372     +0.7327
 Dollar/Dollar                                                                                  
 Dollar/Norway    NOK=        7.7672         7.7731      -0.08%         -5.36%      +7.7872     +7.7580
 Euro/Norway      EURNOK=     9.5907         9.6243      -0.35%         -2.61%      +9.6410     +9.5925
 Dollar/Sweden    SEK=        8.4115         8.4154      -0.32%         +2.56%      +8.4272     +8.4007
 Euro/Sweden      EURSEK=     10.3861        10.4191     -0.32%         +5.56%      +10.4450    +10.3860
 
    
 (Additional reporting by Hideyuki Sano in TOKYO
Editing by Larry King and Steve Orlofsky)
  
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