By Swati Pandey
SYDNEY, Dec 31 (Reuters) - The dollar dipped to a near
three-week low against the yen in thin year-end volume on
Tuesday as investors favoured riskier assets, led by renewed
optimism about global growth.
The greenback was off 0.1% at 108.77 against the Japanese
yen JPY= , on track for its third straight session of losses
and within a whisker of Monday's 108.74, the weakest since Dec.
12.
The dollar index .DXY , which measures the currency against
a basket of rivals, was flat at 96.728 in early Asian trade.
On Friday, the index had suffered its biggest one-day fall
since March, which left its gains for the year at under 0.6%,
compared with returns of 4.4% in 2018. It is now on track for
the smallest rise since 2013.
Encouraging news on the Sino-U.S. trade deal boosted risk
sentiment in currency markets overnight.
The White House's trade adviser, Peter Navarro, on Monday
said the U.S.-China Phase 1 trade deal would likely be signed in
the next week, but said confirmation would come from President
Donald Trump or the U.S. Trade Representative.
Increased optimism about U.S.-China trade relations and an
improved global growth outlook drove investors out of other
safe-haven assets like Treasury bonds while the risk-sensitive
Australian and New Zealand dollars jumped to five-month highs.
US/
China's yuan CNH= strengthened a touch in the offshore
market to 6.972 on Monday, its highest since Dec. 13. It was
last at 6.9780.
Investor appetite for risk also helped drive the euro EUR=
to a 4-1/2-month high of $1.121 on Monday. It was last up 0.1%
at $1.1209. Signs that the euro zone economy may be stabilising
have lifted the single currency in recent weeks. Sterling GBP= was last treading water at $1.3114 against
the dollar after rising 2.8% so far this year. Concerns that
Britain is headed for a disruptive "hard Brexit" at the end of
2020 have hurt the pound since mid-December.