April 4, 2018 / 1:31 PM / 4 months ago

FOREX-Dollar weakens vs yen, Swiss franc on U.S.-China trade tension

    * Dollar falls in 4 of 5 sessions vs yen 
    * Markets edgy in face of trade tensions
    * Yuan slide after China trade retaliation
    * ADP payrolls report shows higher-than-expected jobs gain
    * Graphic: World FX rates in 2018 tmsnrt.rs/2egbfVh

 (Recasts, adds U.S. data, analyst comment, FX table, updates
prices in text, changes byline, dateline; previous London)
    By Gertrude Chavez-Dreyfuss
    NEW YORK, April 4 (Reuters) - The dollar fell against the
yen and Swiss franc on Wednesday after China retaliated against
the Trump administration's plan to slap tariffs on Chinese
goods, proposing a list of similar duties on a wide range of
U.S. imports.
    In the midst of the U.S.-China trade tension, the dollar has
weakened in four of the last five sessions against the yen, down
nearly 6 percent so far this year. Against the Swiss franc, the
greenback has fallen 1.6 percent so far in 2018.
    The Japanese and Swiss currencies tend to appreciate in
times of geopolitical and economic stress.
    China on Wednesday proposed tariffs on U.S. imports
including soybeans, planes, cars, beef and chemicals.
 The Chinese plan came hours after Washington
unveiled a detailed breakdown of some 1,300 Chinese industrial,
transport and medical goods that could be subject to 25 percent
duties.
    China's move is "a sign that Beijing is up to the fight and
that if U.S. President Donald Trump wants to prove that trade
wars are in fact easy to win, he'll have to back it up with
actions," said Craig Erlam, senior market analyst at OANDA in
London.
    "Ultimately, the response we're seeing in the markets
suggests investors are not on board with the actions being taken
by both countries and see them as a real threat to what has been
a good period of global growth," he added.
    The Chinese news dominated the market, overshadowing a U.S.
employment report by payrolls processor ADP which showed a
higher-than-expected 241,000 private sector jobs created last
month.
    "Admittedly, the ADP survey is not a great leading indicator
for payrolls, not least because it is partly based on lagged
changes in payrolls," said Paul Ashworth, chief U.S. economist
at Capital Economics in Toronto.
    "Nevertheless, to the extent it is useful, it points to a
labor market still in exceptionally good health."
    In morning trading, the greenback slid 0.3 percent against
the yen to 106.26 yen, and slipped 0.1 percent versus the
Swiss franc to 0.9584 franc.
    In the aftermath of the Chinese tariffs, the yuan on
Wednesday suffered its biggest one-day loss versus the dollar
since mid-February, down 0.6 percent at 6.3094 yuan per dollar. 
    The Chinese currency had been strengthening this year,
fueling speculation on whether Beijing can intervene in markets
to limit its rise.
    
    ========================================================
    Currency bid prices at 9:11AM (1311 GMT)
 Description      RIC         Last           U.S. Close  Pct Change     YTD Pct     High Bid    Low Bid
                                              Previous                   Change                 
                                              Session                                           
 Euro/Dollar      EUR=        $1.2294        $1.2269     +0.20%         +2.48%      +1.2314     +1.2257
 Dollar/Yen       JPY=        106.2500       106.5900    -0.32%         -5.70%      +106.6800   +106.0000
 Euro/Yen         EURJPY=     130.63         130.79      -0.12%         -3.36%      +130.8700   +130.2400
 Dollar/Swiss     CHF=        0.9583         0.9586      -0.03%         -1.64%      +0.9599     +0.9552
 Sterling/Dollar  GBP=        1.4067         1.4056      +0.08%         +4.11%      +1.4096     +1.4016
 Dollar/Canadian  CAD=        1.2839         1.2805      +0.27%         +2.11%      +1.2844     +1.2775
 Australian/Doll  AUD=        0.7683         0.7683      +0.00%         -1.51%      +0.7717     +0.7663
 ar                                                                                             
 Euro/Swiss       EURCHF=     1.1785         1.1765      +0.17%         +0.82%      +1.1787     +1.1757
 Euro/Sterling    EURGBP=     0.8737         0.8726      +0.13%         -1.64%      +0.8759     +0.8714
 NZ               NZD=        0.7290         0.7256      +0.47%         +2.88%      +0.7296     +0.7256
 Dollar/Dollar                                                                                  
 Dollar/Norway    NOK=        7.8374         7.8367      +0.01%         -4.50%      +7.8586     +7.8265
 Euro/Norway      EURNOK=     9.6377         9.6183      +0.20%         -2.14%      +9.6552     +9.6058
 Dollar/Sweden    SEK=        8.3948         8.3898      +0.24%         +2.35%      +8.4078     +8.3775
 Euro/Sweden      EURSEK=     10.3220        10.2970     +0.24%         +4.91%      +10.3297    +10.2839
 
 (Reporting by Gertrude Chavez-Dreyfuss; Additional reporting by
Tommy Wilkes in London; Editing by David Gregorio)
  
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