FOREX-Dollar wobbles as markets await U.S. presidential debate

* Graphic: World FX rates in 2020 https://tmsnrt.rs/2RBWI5E

By Eimi Yamamitsu
TOKYO, Sept 30 (Reuters) - The dollar edged down in Asian
trade on Wednesday as investors counted down to the first U.S.
presidential debate between President Donald Trump and
Democratic challenger Joe Biden.
The 90-minute presidential debate at 0100 GMT will be
closely tracked by financial markets with some political
analysts seeing it as Trump's best chance to get on top of a
race he has consistently lagged in opinion polls. "There is no consensus in the market on how either
candidate's victory will move the dollar," said Masafumi
Yamamoto, chief currency strategist at Mizuho Securities.
"If, for example, the debate turns out to be a perceived
victory by Trump, it's going to be interesting to see how the
markets move-- particularly the dollar, U.S. stocks futures and
10-year Treasury yields," he said.
The dollar index against a basket of currencies fell 0.32%
to 93.858 =USD , after hitting a two-month high last week.
Also weighing on the greenback were month- and quarter-end
currency flows, while better-than-expected U.S. economic data
also dented its perceived safe-haven bid.
U.S. consumer confidence rebounded more than expected in
September as households' views of the labour market improved.
The euro EUR=EBS was steady at $1.1742, having hit a
one-week high of $1.1746 overnight. Against the yen, the single
currency changed hands at 124.04 yen, hovering near a two-week
high of 124.11 yen EURJPY= .
The dollar was little changed against the Swiss franc at
0.9195 franc, after falling as low as 0.9191 franc overnight
CHF=EBS .
Against the yen, the greenback weakened slightly to 105.67
yen JPY= , a fraction below a two-week high of 105.74 it marked
overnight.
Markets also remain focussed on progress made around a U.S.
fiscal stimulus packaged to cushion the coronavirus blow.
U.S. House Speaker Nancy Pelosi said on Tuesday she hoped to
have a coronavirus aid deal with the White House this week,
after speaking with Treasury Secretary Steve Mnuchin and making
plans for further talks on Wednesday.
Pelosi said on Monday Democratic lawmakers unveiled a new
$2.2 trillion fiscal stimulus bill, but in an interview with
CNBC, White House economic adviser Larry Kudlow made clear that
the White House still views the updated figure as too high.
“We believe it is unlikely the stimulus bill progress in
its current form. The House Democrats stimulus bill is more than
$1 trillion above what key Republican policymakers are willing
to consider,” said Commonwealth Bank of Australia currency
analyst Kim Mundy in a note.
“The U.S. economic recovery is at risk without more fiscal
stimulus and as a result, USD is vulnerable to additional upside
in the short term.”
On the data front, China releases both official and private
manufacturing PMIs for September later in the morning.
A Reuters poll on Monday showed China's factory activity
likely expanded at a slightly faster pace in September, as the
economy extends a steady recovery from the coronavirus crisis.
Sterling was steady at $1.2864 GBP=D3 against the dollar.
The British pound initially gained overnight on hopes for a
Brexit deal, but retreated after the Bank of England's governor
kept the door open for using sub-zero interest rates if
needed. The dollar stepped back against commodity currencies such as
the Australian and New Zealand dollars. The Aussie edged 0.18%
higher to last sit at $0.7148, while the kiwi firmed against the
dollar, last fetching $0.6599 NZD=D3 .