June 21, 2018 / 2:43 PM / 6 months ago

FOREX-Dollar drops off 11-month peak after weak Philly Fed data

    * Philly Fed business index posts biggest drop in over 4
years
    * Pound rises from 7-mth low as BoE economist calls for rate
hike
    * Swiss franc, Norwegian crown rise after policy meetings

 (Updates trading, changes dateline, previous LONDON)
    By Richard Leong
    NEW YORK, June 21 (Reuters) - The dollar fell off an
11-month high on Thursday against a basket of major currencies
as the Philadelphia Federal Reserve's gauge of U.S. Mid-Atlantic
business activity fell to a near 1-1/2 year low, spurring
profit-taking on the greenback.
    The euro recovered from its weakest level since July 2017
which was tied to bets on a protracted period of monetary policy
divergence between the U.S. and European central banks. 
    The single currency was also pressured earlier after the
Italian government appointed two eurosceptics to head key
finance committees, reigniting worries about anti-euro voices in
the euro zone's third-largest economy.
    "Philly Fed missed on the downside. That was a convenient
excuse for traders to take profits," said Joe Manimbo, senior
market analyst with Western Union Business Solutions in
Washington.
    The Philadelphia Fed said its barometer on U.S. Mid-Atlantic
business activity fell from 34.4 in May to 19.9 in June, its
lowest since November 2016.
    The index's sharpest drop since January 2014 came amid
escalation in a U.S.-China trade conflict, which has underpinned
safe-haven support for the dollar in recent days.
    "It does loom as a potential headwind for the U.S. and
global economy," Manimbo said of the rising trade tensions.
    The world's top central bankers at a conference in Sintra,
Portugal on Wednesday acknowledged that a serious dispute with
more tariffs would weaken their economic outlook, although they
have not altered their policy stance for now.
    At 10:25 a.m. (1425 GMT), an index that tracks the dollar
against the euro, yen, sterling and three other currencies
 slipped 0.1 percent to 94.926 after touching 95.529
earlier Thursday, which was its highest since mid-July 2017.
    The euro rebounded from an 11-month low to $1.1592,
while the greenback decreased 0.4 percent to 110.93 yen. 
    Elsewhere, sterling rose over 0.5 percent at
$1.3243, recovering from a seven-month trough after the Bank of
England's chief economist, Andy Haldane, unexpectedly joined
those calling for rates to rise to 0.75 percent, citing concerns
about growing wage pressure.
    Haldane's vote, however, was not enough to flip the BOE's
decision to leave key borrowing costs at 0.5 percent. 
    Meanwhile, even as the Swiss National Bank as expected clung
to its negative interest rate policy, the Swiss currency rose
against the euro to 1.1499 franc as some traders saw a
slightly more hawkish tone from the central bank. 
    Norway's central bank also kept rates on hold but said it
was on track to raise rates in September, sending the Norwegian
crown to an eight-month peak versus the euro at
9.3900.
    ========================================================
    Currency bid prices at 10:28AM (1428 GMT)
 Description      RIC         Last           U.S. Close  Pct Change     YTD Pct     High Bid    Low Bid
                                              Previous                   Change                 
                                              Session                                           
 Euro/Dollar      EUR=        $1.1592        $1.1570     +0.19%         +0.00%      +1.1610     +1.1509
 Dollar/Yen       JPY=        109.9500       110.3500    -0.36%         +0.00%      +110.7500   +109.9400
 Euro/Yen         EURJPY=     127.46         127.72      -0.20%         +0.00%      +128.0200   +127.0100
 Dollar/Swiss     CHF=        0.9916         0.9959      -0.43%         +0.00%      +0.9985     +0.9917
 Sterling/Dollar  GBP=        1.3245         1.3171      +0.56%         +0.00%      +1.3257     +1.3103
 Dollar/Canadian  CAD=        1.3296         1.3310      -0.11%         +0.00%      +1.3334     +1.3292
 Australian/Doll  AUD=        0.7383         0.7367      +0.22%         +0.00%      +0.7391     +0.7346
 ar                                                                                             
 Euro/Swiss       EURCHF=     1.1495         1.1527      -0.28%         +0.00%      +1.1541     +1.1479
 Euro/Sterling    EURGBP=     0.8750         0.8785      -0.40%         +0.00%      +0.8799     +0.8726
 NZ Dollar/Dolar  NZD=        0.6874         0.6861      +0.19%         +0.00%      +0.6876     +0.6827
 Dollar/Norway    NOK=        8.1369         8.1778      -0.50%         +0.00%      +8.1987     +8.1307
 Euro/Norway      EURNOK=     9.4327         9.4674      -0.37%         +0.00%      +9.4734     +9.3911
 Dollar/Sweden    SEK=        8.9054         8.8819      +0.44%         +0.00%      +8.9498     +8.8706
 Euro/Sweden      EURSEK=     10.3272        10.2819     +0.44%         +0.00%      +10.3441    +10.2545
 
    

    


    
 (Additional Reporting by Tommy Wilkes in LONDON
Editing by David Evans/Keith Weir)
  
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