Hopes for Brexit deal lift euro, sterling

* Emerging market currencies pressured lower
* Speculators pare bullish dollar bets to 5-week low - CFTC
* BOE, ECB seen holding policies steady on Thursday
* Graphic: World FX rates in 2018 http://tmsnrt.rs/2egbfVh

(Updates market action, adds quote)
By Richard Leong
NEW YORK, Sept 10 (Reuters) - The euro and sterling rose
against the dollar on Monday after the European Union's top
negotiator said an agreement for Britain to leave the economic
bloc might be reached in the coming weeks.
The pound in particular had been under pressure in recent
weeks on anxiety that Britain would exit from the EU without any
formal trading arrangement.
"Sterling bears have been caught off side. The euro is also
getting a bump as people are jumping on a 'risk-on' sentiment,"
said Dean Popplewell, vice president of market analysis at OANDA
in Toronto.
EU chief negotiator Michel Barnier told a forum in Slovenia
a Brexit deal was "realistic in six to eight weeks."

Sterling was up as much as 1 percent versus the
dollar. It was last up 0.9 percent at $1.3033, Reuters data
The euro rose nearly 0.4 percent at $1.15965,
while it touched a near one-month low against the pound, last
down over 0.5 percent at 88.98 pence.
Policy-makers at the Bank of England and European Central
Bank are widely expected to leave their policy unchanged at
their respective meetings on Thursday.
"It seems unreasonable to expect (Mario) Draghi to signal a
course change" at the ECB, said Win Thin, global head of
emerging market currency strategy at Brown Brothers Harriman in
New York. "It is an easy call: unanimous decision to hold after
hiking rates last month," Thin added.
The more positive view on Brexit reduced safe-haven holdings
of the dollar, whose decline was limited by an upbeat U.S. jobs
report released on Friday and lingering worries about emerging
market currencies, analysts said.
An index that tracks the dollar against the euro, sterling,
yen and three other currencies was down 0.24 percent at
Speculators' net long bets on the U.S. dollar fell to a
five-week low, worth $20.60 billion in the week ended Sept. 4,
according to calculations by Reuters and Commodity Futures
Trading Commission data released on Friday.
An index for emerging market currencies fell
0.5 percent to near one-week lows. The Indian rupee fell
to a record low at 72.675 per dollar, while the Hong Kong dollar
hit the lower end of a trading band at 7.85 per U.S.
Meanwhile, the Swedish crown, which has been the
worst performing currency among the majors, edged up 0.1 percent
at 9.059 crown per dollar. Gains for the far right in Sunday's
election were smaller than some polls had predicted - even
though the country faces weeks of uncertainty as it tries to
form a government.
Currency bid prices at 2:26PM (1826 GMT)
Description RIC Last U.S. Close Pct Change YTD Pct High Bid Low Bid
Previous Change
Euro/Dollar EUR= $1.1596 $1.1551 +0.39% +0.00% +1.1615 +1.1527
Dollar/Yen JPY= 111.1300 111.0500 +0.07% +0.00% +111.1800 +110.8600
Euro/Yen EURJPY= 128.88 128.30 +0.45% +0.00% +129.0600 +127.8900
Dollar/Swiss CHF= 0.9749 0.9691 +0.60% +0.00% +0.9753 +0.9687
Sterling/Dollar GBP= 1.3030 1.2921 +0.84% +0.00% +1.3051 +1.2897
Dollar/Canadian CAD= 1.3160 1.3154 +0.05% +0.00% +1.3197 +1.3151
Australian/Doll AUD= 0.7108 0.7106 +0.03% +0.00% +0.7131 +0.7099
Euro/Swiss EURCHF= 1.1306 1.1196 +0.98% +0.00% +1.1315 +1.1187
Euro/Sterling EURGBP= 0.8897 0.8943 -0.51% +0.00% +0.8957 +0.8894
NZ Dollar/Dolar NZD= 0.6521 0.6533 -0.18% +0.00% +0.6547 +0.6513
Dollar/Norway NOK= 8.3878 8.4500 -0.74% +0.00% +8.4564 +8.3641
Euro/Norway EURNOK= 9.7269 9.7594 -0.33% +0.00% +9.7714 +9.6948
Dollar/Sweden SEK= 9.0566 9.0570 +0.12% +0.00% +9.0755 +9.0230
Euro/Sweden EURSEK= 10.5043 10.4915 +0.12% +0.00% +10.5087 +10.4267

(Additional reporting by Saqib Iqbal Ahmed in New York
Saikat Chatterjee in London
Olof Swahnberg in Stockholm;
Editing by Alistair Bell and Chizu Nomiyama)

First Published: 2018-09-10 03:22:56
Updated 2018-09-10 20:50:37

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