April 2, 2018 / 6:25 PM / 7 months ago

FOREX-Dollar slides on worsening China-U.S. trade dispute

    * Dollar falls vs yen as U.S. stocks sell-off
    * Focus on global trade tensions , U.S. data this week

 (Adds comment, updates prices in text, table)
    By Gertrude Chavez-Dreyfuss
    NEW YORK, April 2 (Reuters) - The dollar fell on Monday,
dropping versus the yen for a third straight session, as China
imposed extra tariffs on U.S. products, escalating a dispute
between two of the world's biggest economies.
    Volume though was light as some European markets are closed
for the Easter Monday holiday.
    China has slapped extra tariffs of up to 25 percent on 128
U.S. products including frozen pork, as well as on wine and
certain fruits and nuts, in response to U.S. duties on imports
of aluminum and steel, China's finance ministry said.

    The tariffs, to take effect on Monday, match a list of
potential tariffs on up to $3 billion in U.S. goods published by
China on March 23.
    "The yen and Swiss franc are the real winners," said Paresh
Upadhyaya, director of currency strategy, at Amundi Pioneer
Asset Management in Boston.
    "It's an equity induced sell-off triggered by trade
concerns. Those concerns raise worries about global growth.
There's more of a risk premium built in for the euro as well as
other export-oriented currencies like the Canadian, Australian
and New Zealand dollars."
    The Japanese and Swiss units, typically viewed as safe-
haven currencies, tend to benefit at the dollar's expense in
times of geopolitical and financial tensions. 
    The Swiss franc traded slightly lower against the dollar,
but it has been catching up as U.S. stocks accelerate their
sell-off.
    In mid-afternoon trading, the dollar was down 0.2 percent at
90.007 against a basket of six major currencies, backing
off from a one-week high of 90.178 set last Thursday.
    The greenback fell 0.6 percent versus the yen to 105.68 yen 
, after rising more than 1.5 percent last week for its
biggest weekly gain since September 2017.
    The dollar rose against the yen through most of last week,
helped by signs China and the United States were working behind
the scenes to avoid a full-blown trade war.
    The dollar is expected to struggle against the yen for some
time given the tension between the world's two largest
economies.
    The Trump administration is expected to release a list of
other products to be targeted with tariffs by Friday. 
    Beyond the potential trade war, investors are also focused
on U.S. data this week, led by the non-farm payrolls report for
March. The reports should determine the path for future interest
rate increases, analysts said.
    The euro, meanwhile, was down 0.1 percent at $1.2304,
weighed down by overall caution in the market amid a U.S. stock
market sell-off. 
    
    ========================================================
    Currency bid prices at 2:05PM (1805 GMT)
 Description      RIC         Last           U.S. Close  Pct Change     YTD Pct     High Bid    Low Bid
                                              Previous                   Change                 
                                              Session                                           
 Euro/Dollar      EUR=        $1.2303        $1.2321     -0.15%         +2.56%      +1.2344     +1.2283
 Dollar/Yen       JPY=        105.6600       106.2600    -0.56%         -6.22%      +106.4400   +105.6700
 Euro/Yen         EURJPY=     130.02         130.97      -0.73%         -3.82%      +131.2900   +130.0000
 Dollar/Swiss     CHF=        0.9545         0.9534      +0.12%         -2.03%      +0.9564     +0.9528
 Sterling/Dollar  GBP=        1.4044         1.4015      +0.21%         +3.93%      +1.4077     +1.4020
 Dollar/Canadian  CAD=        1.2938         1.2891      +0.36%         +2.87%      +1.2942     +1.2862
 Australian/Doll  AUD=        0.7650         0.7678      -0.36%         -1.94%      +0.7697     +0.7651
 ar                                                                                             
 Euro/Swiss       EURCHF=     1.1745         1.1747      -0.02%         +0.48%      +1.1763     +1.1742
 Euro/Sterling    EURGBP=     0.8759         0.8788      -0.33%         -1.40%      +0.8783     +0.8753
 NZ Dollar/Dolar  NZD=        0.7212         0.7234      -0.30%         +1.78%      +0.7240     +0.7212
 Dollar/Norway    NOK=        7.8921         7.8478      +0.56%         -3.86%      +7.8988     +7.8301
 Euro/Norway      EURNOK=     9.7095         9.6630      +0.48%         -1.41%      +9.7156     +9.6613
 Dollar/Sweden    SEK=        8.3983         8.3408      +0.55%         +2.40%      +8.4038     +8.3299
 Euro/Sweden      EURSEK=     10.3358        10.2794     +0.55%         +5.05%      +10.3382    +10.2716
 
 (Reporting by Gertrude Chavez-Dreyfuss; Additional reporting by
Richard Leong; Editing by Susan Thomas and Lisa Shumaker)
  
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