* U.S., China have agreed to tentative trade truce -report
* Dollar on track for first quarterly loss since Q1 2018
* Yen posts solid gain vs greenback in second quarter
* Graphic: World FX rates in 2019 http://tmsnrt.rs/2egbfVh
(Updates to late U.S. market action)
By Richard Leong
NEW YORK, June 27 (Reuters) - The dollar held steady against
most major currencies on Thursday as traders moved to the
sidelines in advance of this weekend's G20 summit where China
and the United States may reach a truce on their trade conflict.
The world's two largest economies have agreed to a tentative
truce in their trade dispute, Hong Kong's South China Morning
Post cited sources as saying. U.S. President Donald Trump and
Chinese President Xi Jinping are scheduled to meet on Saturday.
The report eased fears that Trump would impose additional
tariffs on $300 billion on Chinese goods, but financial markets
remain on edge about the trade talks, analysts and traders said.
"It's just a lot of noise until there is a deal," said Minh
Trang, senior foreign exchange trader at Silicon Valley Bank in
Santa Clara, California. "We are in a holding pattern."
Traders shrugged off a U.S. government report that showed
the economy expanded at a 3.1% annualized pace in the first
quarter, unchanged from the government's estimate last month.
In late U.S. trading, the index that tracks the dollar
against the euro, yen, sterling and three other currencies
.DXY was little changed at 96.206, holding above a three-month
low of 95.843 reached on Tuesday.
The index broke below its 200-day moving average last week,
which analysts cite as bearish for the dollar, after the Federal
Reserve signaled it was prepared to lower interest rates to
combat the risk from global trade tensions and sluggish domestic
inflation. The dollar index was on track for it first quarterly loss
since the first quarter of 2018.
China's offshore yuan rose 0.20% to 6.8742 per dollar
CNH=EBS , helping the renminbi back toward the six-week high of
6.8370 yuan per dollar touched last week.
The offshore yuan, however, has weakened 2.26% in the second
quarter.
Whether Trump and Xi strike a trade truce this weekend could
shape expectations on Fed policy in the coming months, analysts
said.
Traders have priced in the probability the Fed would lower
rates in July and might cut rates at least three times by
year-end, according to interest rates futures calculated by CME
Group's FedWatch program.
The yen edged up 0.03% to 107.755 per dollar. The Japanese
currency has risen a solid 2.7% against the greenback in the
second quarter, boosted by expectations of Fed rate cuts and the
trade war. Rising tensions between Iran and the United States
has also stoked safe-haven demand for the Japanese currency.
Currency bid prices at 2:51PM (1851 GMT)
Description RIC Last U.S. Close Pct Change YTD Pct High Bid Low Bid
Previous Change
Session
Euro/Dollar EUR= $1.1367 $1.1368 -0.01% -0.89% +1.1381 +1.1349
Dollar/Yen JPY= 107.7200 107.7700 -0.05% -2.30% +108.1500 +107.6600
Euro/Yen EURJPY= 122.46 122.52 -0.05% -2.98% +122.8800 +122.4100
Dollar/Swiss CHF= 0.9761 0.9780 -0.19% -0.54% +0.9814 +0.9762
Sterling/Dollar GBP= 1.2670 1.2688 -0.14% -0.68% +1.2724 +1.2665
Dollar/Canadian CAD= 1.3098 1.3125 -0.21% -3.95% +1.3138 +1.3098
Australian/Doll AUD= 0.7002 0.6983 +0.27% -0.67% +0.7006 +0.6984
ar
Euro/Swiss EURCHF= 1.1098 1.1116 -0.16% -1.39% +1.1144 +1.1098
Euro/Sterling EURGBP= 0.8969 0.8958 +0.12% -0.17% +0.8976 +0.8938
NZ NZD= 0.6698 0.6678 +0.30% -0.28% +0.6701 +0.6672
Dollar/Dollar
Dollar/Norway NOK= 8.5170 8.4939 +0.27% -1.42% +8.5247 +8.4902
Euro/Norway EURNOK= 9.6830 9.6559 +0.28% -2.25% +9.6933 +9.6545
Dollar/Sweden SEK= 9.2756 9.2607 +0.18% +3.48% +9.2911 +9.2529
Euro/Sweden EURSEK= 10.5474 10.5280 +0.18% +2.76% +10.5555 +10.5212
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GRAPHIC-Trade tensions boost U.S. rate-cut expectations https://tmsnrt.rs/2KdE2by
GRAPHIC-Trade tensions boost U.S. rate-cut expectations
interactive https://tmsnrt.rs/2KdDNxa
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