* Graphic: World FX rates in 2019 http://tmsnrt.rs/2egbfVh
LONDON, Sept 20 (Reuters) - The dollar edged lower on Friday
and was headed for a third straight week of losses as
expectations of a breakthrough in trade tensions between
Washington and Beijing fuelled a revival in risk appetite.
The losses came after the Federal Reserve cut interest rats
by a quarter-point rate, compounded by a spike in overnight U.S.
repo rates this week, which cut into demand for dollars.
Other major central banks, including the Bank of England,
the Bank of Japan and the Swiss National Bank, left rates
unchanged this week, disappointing some dollar bulls.
"Other central banks are not in easing mode as the Fed has
been this week and hopes of a breakthrough in trade talks
between the United States and China is also dampening some of
the safe-haven appeal of the dollar," said Thu Lan Nguyen, a
foreign exchange analyst at Commerzbank.
The dollar slipped 0.1% against an index of other currencies
.DXY to 98.18, on track for its third consecutive weekly drop.
Markets focussed on U.S.-China trade talks in Washington
before high-level discussions next month. Some signs of progress
were emerging. "What we're looking at is brewing central-bank divergence,"
said Chris Weston, head of research at brokerage Pepperstone
Group in Melbourne. "We're starting to see signs of that
resonating in currency markets."
Sterling was the biggest gainer. European Commission
President Jean-Claude Juncker said he thought Brussels could
reach agreement with Britain on its departure from the European
Union. Sterling rose 0.5% to a two-month high against the dollar
GBP=D3 and to 87.87 pence against the euro EURGBP=D3 , a
four-month high The Australian dollar AUD=D3 rose to around $0.6799 but
remained near the three-week low it reached on Thursday. The New
Zealand dollar NZD=D3 fell to $0.6285, its weakest since Sept.
3.
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FX market positions https://tmsnrt.rs/30att1o
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