* Mkts wait for Fed, ECB, meetings, trade deadline
* Swedish crown surges on inflation surprise
* Sterling stung by latest election poll
* Graphic: World FX rates in 2019 tmsnrt.rs/2egbfVh
By Tommy Reggiori Wilkes
LONDON, Dec 11 (Reuters) - The U.S. dollar clawed higher on Wednesday as investors awaited the outcome of the Federal Reserve meeting and drew some support from hopes that U.S. President Donald Trump will delay the imposition of tariffs on Chinese goods.
The notable movers in foreign exchange markets were the Swedish crown that surged after higher-than-expected inflation numbers, and the British pound, which shed 0.3% after a poll showed the ruling Conservative Party’s lead narrowing.
FX markets were broadly range-bound, however, with investors awaiting Thursday’s British general election, a European Central Bank meeting and the Dec. 15 trade deadline.
Wednesday sees little in the way of key economic data, with the big policy and political events of the next 48 hours the main focus for markets.
The dollar rose 0.2% against a basket of currencies and 0.1% versus the euro to $1.1080, helped by a Wall Street Journal report of officials from both the United States and China saying the groundwork was being laid to push back the tariff deadline.
“The trade negotiations will be key. You could argue there is a degree of complacency here,” said Neil Mellor, an FX analyst at BNY Mellon.
Mellor said he thought the Federal Reserve meeting would be a “damp squib”, while Christine Lagarde’s first policy meeting at ECB chief was unlikely to produce any fireworks.
Economic uncertainty stemming from the U.S.-China trade war has prompted the U.S. Federal Reserve to cut interest rates three times this year. It is almost unanimously expected to leave interest rates unchanged on Wednesday.
Sterling’s recent rally came to a halt after the latest poll pointed to a tighter election race in Britain than many investors have expected.
The pound was last down 0.3% at $1.3120, while against the euro it was 0.2% lower at 84.485 pence.
“With regards to both the U.K. election and U.S.-China talks, markets have been leaning towards optimism recently. Therefore we need to be careful about market reactions if those expectations do not materialise,” said Kyosuke Suzuki, director of foreign exchange at Societe Generale.
Sweden’s crown enjoyed a bounce after stronger than expected consumer price inflation data for November. The euro fell 0.6% versus the crown to 10.479 crowns, a 7-1/2 month high for the Swedish currency.
The dollar was unchanged against the Japanese yen at 108.75
The New Zealand dollar slipped 0.3% to $0.6526 NZD=D4 as profit-taking overshadowed upbeat data and the promise of fiscal stimulus by Wellington. AUD/ (Additional reporting by Hideyuki Sano in Tokyo Reporting by Tommy Reggiori Wilkes Editing by Alexandra Hudson)
https://www.reuters.com/article/global-forex/forex-dollar-grinds-higher-on-hopes-for-tariff-delay-swedish-crown-surges-idUSL8N28L1P6
2019-12-11 08:52:00Z
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