FOREX-Dollar up against sterling, euro on revived Brexit fears

(New throughout; adds analyst quotes; changes dateline,
previous LONDON)
By Kate Duguid
NEW YORK, Oct 22 (Reuters) - The dollar rose on Tuesday
against the pound and euro as uncertainty spread ahead of the
British parliament's vote on the Withdrawal Agreement Bill which
will shine light on when and how Britain will exit the EU.
The United Kingdom is expected to leave the European Union
on Oct. 31, but the deal Prime Minister Boris Johnson and his
European counterparts agreed last week has not been yet voted on
in Britain's parliament, which forced Johnson to request an
extension to the leaving date from Brussels. The bill is expected to be presented for a vote around 1800
GMT.
Sterling GBP= was down 0.35% to $1.291 in mid-morning
trade after Johnson told parliament that if it delayed his
Brexit legislation he would abandon his attempt to ratify the
deal to leave the European Union and push for an election
instead. The euro EUR= was down 0.19% versus the dollar, though
remains up 2.09% this month, driven mostly by recent Brexit
developments, as well as by trade disputes between the United
States and China.
"I think the clear theme for euro and sterling is
consolidation after last week's Brexit euphoria," said Mark
McCormick, global head of foreign exchange strategy, TD
Securities.
Elsewhere, he said, Tuesday morning trade was driven by,
among other factors, "a reach for yield, which is probably a
function of a ceasefire in the trade wars and the scope for Fed
easing next week."
Hopes the United States and China were making progress to
resolve their trade dispute supported the dollar in the Asian
trading session. China's Vice Foreign Minister Le Yucheng said
progress was being made in discussions with the United States
and that while both sides respected each other, no problem was
beyond resolution. The dollar index .DXY was last up 0.17% to 97.489.
Elsewhere, the Canadian dollar CAD= weakened against its
U.S. counterpart after Prime Minister Justin Trudeau hung onto
power after a tight election on Monday that saw his government
reduced to a minority. He now looks set to govern with support
from the left-leaning New Democrats who would make the
construction of new oil pipelines more difficult. The left-leaning coalition isn't "beneficial for the
Canadian dollar, versus a Conservative majority which would have
seen a rally, largely because there is going to be focus on the
pipelines, which reinforce some of the competitiveness issues on
the Canadian oil front," said McCormick.