FOREX-Dollar set for 4th monthly drop; yen steadies on reports of Suga run for PM

* Yen recovers somewhat on reports Suga seeks to succeed Abe
* Dollar tracks toward 1.3% August drop
* China PMIs, Fed speakers eyed
* Graphic: World FX rates in 2020 https://tmsnrt.rs/2RBWI5E

By Tom Westbrook
SINGAPORE, Aug 31 (Reuters) - The dollar was poised to
register its fourth consecutive monthly decline on Monday, its
longest streak since the summer of 2017, while the yen steadied
after a longtime lieutenant of Shinzo Abe reportedly joined the
race to succeed him as Japan's leader.
Yoshihide Suga, Chief Cabinet Secretary to Abe, would be
expected to extend the fiscal and monetary stimulus that defined
Abe's term in government.
Kyodo reported his intention to run for the leadership on
Sunday, citing an unnamed source. TV Tokyo reported he had
sounded out party support at a Saturday meeting.
The yen JPY=EBS eased by about 0.2% in morning trade to
105.55, having climbed as far as 104.195 on Friday in the wake
of Abe's resignation as prime minister for health reasons.
Elsewhere the dollar was steady after some early-morning
pressure, following another round of heavy selling late last
week.
The Australian dollar AUD=D3 touched a 21-month peak of
$0.7369 before retreating slightly and the kiwi NZD=D3 sat at
$0.6739, just below a post-COVID high of $0.6744 that it posted
on Friday. AUD/
A speech last Thursday in which Federal Reserve Chair Jerome
Powell outlined an accommodative shift in the central bank's
approach to inflation has weighed on the greenback as investors
interpreted it as meaning rates would stay lower for longer.
For the month of August, the dollar is down nearly 1.3%
against a basket of currencies =USD and about 1% against the
euro, having dropped more than 10% against both since March.
"It seems clear to us that we are at the start of a
multi-year period of dollar decline, from very elevated levels,"
Societe Generale strategists Kit Juckes and Olivier Korber wrote
in a forecast note.
"Our doubts, about whether the dollar can suffer a
broad-based fall in the midst of risk aversion, global recession
and particularly emerging market weakness, have been blown aside
by the Fed."
They said the euro has "gone too far too fast" and will hold
steady for the rest of the year, but rise to $1.25 by September
2021. The yen could rise to 100 per dollar by then, they
forecast, and the Aussie to $0.76.
The euro EUR=EBS firmed 0.1% to $1.1921 early in the Asia
session. Sterling GBP= last traded at $1.3358.
Besides Japanese politics, investors are watching U.S.
opinion polls this week in the wake of the political party
conventions and, on the data front, the Purchasing Managers'
Index figures in China and across major economies, as well as
Friday's U.S. payrolls number.
China's official PMI figures are due at 0100 GMT and are
expected to show factory activity expanded faster in August than
in July. The yuan CNH=D3 inched up to brush a new seven-month high
of 6.8560 in offshore trade early on Monday. CNY/
Eyes are also on speeches from several other U.S. Federal
Reserve officials, beginning with Richard Clarida at 1300 GMT on
Monday and Raphael Bostic at 1430 GMT, for any clues about the
details of the new inflation approach.
"This week could see continued dollar weakness as the market
looks for hints on the new framework," Barclays analysts wrote
in a note. "Month-end rebalancing could also bring weakness at
the beginning of the week."