FOREX-Dollar buoyed by trade deal hopes, strong U.S. economic data

* Dollar aided by Sino-U.S. trade deal, strong U.S. data
* U.S. service sector index rebounds more than expected
* Dollar near 3-month high on yen, gold near low end of
range
* Graphic: World FX rates in 2019 http://tmsnrt.rs/2egbfVh

By Hideyuki Sano
TOKYO, Nov 6 (Reuters) - The dollar held the upper hand
against its rivals on Wednesday, particularly versus traditional
safe-haven currencies, on rising hopes for a U.S.-China trade
deal and a string of solid U.S. economic data.
The dollar index against major currencies .DXY was little
changed at 97.936 in early Asian trade after rising 0.37% the
previous day.
Against the yen, the dollar traded at 109.08 yen JPY= ,
down slightly on the day but still not far from its October high
of 109.285.
The Swiss franc CHF= changed hands at 0.9925 to the dollar
following its 0.5% fall the previous day, while gold XAU=
tumbled 1.73% on Tuesday and last stood at $1,485.8 per ounce,
near the lower end of its trading range over the past month.
The euro stood at $1.1073 EUR= , having dropped 0.49% on
Tuesday and was not far from a near three-week low of $1.10635
hit in U.S. trade on Tuesday.
Hopes that the Trump administration could roll back some of
the tariffs it imposed on goods from China as part of a "phase
one" U.S.-China trade deal boosted risk sentiment in financial
markets. A survey on the vast U.S. service sector published on
Tuesday showed that business sentiment had improved in October
from a three-year low in September. The ISM non-manufacturing sector index rose to 54.7 from
52.6 in September, beating market expectations.
The rebound is a welcome sign for dollar bulls as a fall in
the index would have suggested that malaise in trade war-hit
manufacturers was infecting the service sector, too.
The data came after strong a U.S. employment report on
Friday.
"On top of Sino-U.S. trade issues, the market is reacting to
signs of U.S. economic strength at the moment," said Kyosuke
Suzuki, director of foreign exchange at Societe Generale.
The positive mood spilled over to the risk-sensitive
Australian dollar, which changed hands at $0.6894 AUD=D4 . It
was little changed on the day but has maintained gains of 3.4%
since hitting a 10-1/2-year low on Oct. 2.
The yuan continued to rally on rising optimism for a trade
truce between Washington and Beijing.
The offshore yuan ticked up 0.1% to 6.9948 per dollar CNH=
after having risen to a three-month high of 6.9867 to the dollar
on Tuesday.
The currency has gained 2.9% from its record low in the
offshore trade marked in early September.

(Editing by Kim Coghill and Jacqueline Wong)