* Graphic: World FX rates in 2020 https://tmsnrt.rs/2RBWI5E
* U.S.-China standoff undermines sentiment
* Dollar supported as a safe-haven
* Yuan in focus before National People's Congress
By Stanley White
TOKYO, May 22 (Reuters) - The dollar held gains against major currencies on Friday as worries about renewed diplomatic tensions between the United States and China supported safe-haven demand for the greenback.
The yuan nursed losses in offshore trade, but further declines may be limited in the local session on Friday as Chinese officials are expected to unveil new economic stimulus measures.
Sino-U.S. relations have soured yet again over a broad range of issues, including China's treatment of the former British colony of Hong Kong and its response to the coronavirus pandemic, which is causing risk aversion to spread.
"There have been problems between the United States and China for quite a while now," said Yukio Ishizuki, FX strategist at Daiwa Securities in Tokyo.
"Some very short-term players are changing positions from one day to the next, which makes it difficult to see the trend, but overall the dollar looks to be supported."
The dollar traded at $1.0950 per euro in Asia on Friday, following a 0.3% increase in the previous session.
The dollar bought 0.9705 Swiss franc after posting its biggest gain in more than two weeks on Thursday.
Sterling held steady at $1.2227 before data later on Friday expected to show a plunge in British retail sales.
China is set to impose new national security legislation on Hong Kong after last year's pro-democracy unrest, a Chinese official said on Thursday.
U.S. President Donald Trump has warned that Washington would react "very strongly" to the legislation.
There is a risk that Hong Kong could lose some of its favourable U.S. trading terms that have helped it maintain its position as a global financial centre.
Washington and Beijing are also at loggerheads over Chinese companies' access to advanced technology and criticism of Beijing's response after the novel coronavirus emerged late last year in the central Chinese province of Hubei.
The friction stirs memories of last year's drawn-out trade war between the United States and China, which roiled global financial markets.
Offshore, the yuan stood at 7.1314 per dollar on Friday after falling in the previous session by the most in three weeks.
The focus is on whether the yuan extends declines in onshore trade today.
Chinese Premier Li Keqiang is expected to unveil stimulus measures when the National People's Congress starts on Friday to spur its economy, which has been battered by the coronavirus.
Elsewhere, the yen held steady at 107.63 per dollar. The Bank of Japan will hold an emergency meeting later on Friday to decide the details of a lending scheme for small companies hurt by the pandemic.
The antipodean currencies nursed losses as risk sentiment took a blow.
The Australian dollar changed hands at $0.6568 after a 0.4% decline on Thursday, while the New Zealand dollar last stood at $0.6123. (Reporting by Stanley White; Editing by Sam Holmes)
https://finance.yahoo.com/news/forex-dollar-holds-gains-amid-002422588.html
2020-05-22 00:28:28Z
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