FOREX-Dollar holds ground as central bank meetings loom, pound jumps

* Graphic: World FX rates in 2019 http://tmsnrt.rs/2egbfVh

By Dhara Ranasinghe
LONDON, Dec 9 (Reuters) - The dollar held its ground on
Monday thanks to last week's stronger-than-expected jobs data,
although worries about U.S./China trade talks kept gains in
check, while Britain's pound jumped on the latest polls ahead of
this week's election.
Sterling hit a fresh 2-1/2 year high against the euro after
the latest opinion polls showed the governing Conservative Party
has extended its lead over rivals ahead of Thursday's national
election. Meanwhile, the dollar stood its ground in the wake of
Friday's jobs data. Attention shifted to U.S. Federal Reserve
and European Central Bank policy meetings this week, while a
deadline looms for the next wave of U.S. tariffs on Chinese
goods to kick in.
Top White House economic adviser Larry Kudlow said on Friday
that a Dec. 15 deadline is still in place to impose a new round
of U.S. tariffs on Chinese consumer goods, but President Donald
Trump likes where trade talks with China are going. "If we see Donald Trump decide not to delay tariffs, that
would lead to a risk off reaction in markets," said Nomura
currency strategist Jordan Rochester.
"We don't expect tariffs to go into effect as the talks are
ongoing," he said, adding he did not expect any "fireworks" from
the central bank meetings.
The dollar index .DXY was little changed at 97.63, after
rising 0.3% on Friday on news that U.S. nonfarm payrolls
increased by 266,000 jobs last month, the biggest gain in 10
months. Europe's single currency traded at $1.1064 EUR= , after
hitting a one-week low of $1.10395 on Friday.
The dollar changed hands at 108.52 yen JPY= . It had lifted
to 108.92 yen on the U.S. jobs data before losing momentum.
Analysts said Friday's jobs numbers was positive for the
greenback, bolstering expectations that the Fed would this week
continue to signal a pause in its rate-cutting cycle.
"As long as more people are working and getting paid more,
consumer demand is likely to hold up – that should keep the U.S.
economy going and reduce the likelihood of the Fed cutting rates
again," said Marshall Gittler, strategist at ACLS Global.
Data meanwhile showing China's exports shrank for the fourth
consecutive month in November, underscored persistent pressures
on manufacturers from the Sino-U.S. trade war. Elsewhere, sterling rallied to a seven-month high at $1.3180
GBP=D3 and to a 2-1/2 year peak versus the euro at 83.94
EURGBP=D3 as the latest polls fuelled optimism that Thursday's
election will end near-term Brexit uncertainty.
The ruling Conservative Party extended its lead over the
opposition Labour Party to 14 percentage points, up from 9 a
week ago, an opinion poll by Survation for ITV's Good Morning
Britain showed on Monday.