* ECB decision due at 1145 GMT, press conference 1230 GMT
* Trump's delay to scheduled tariff hike boosts markets
* China's offshore yuan gains 0.5%, Aussie hits 6-wk high
* Graphic: World FX rates in 2019 http://tmsnrt.rs/2egbfVh
By Tommy Wilkes
LONDON, Sept 12 (Reuters) - The euro hovered near $1.10 on
Thursday as traders waited to see the scale of fresh stimulus
expected from the European Central Bank, while China's yuan and
Australia's dollar were buoyed by further signs of a thaw in the
U.S.-China trade war.
After a difficult August in which concerns about a global
recession sparked a scramble into safer assets, investors have
been returning to riskier markets this month, encouraged by
China and the United States making moves to ease trade tensions
and by receding fears of a no-deal Brexit.
China on Wednesday exempted a basket of U.S. goods from its
tariffs, while U.S. President Donald Trump said in a tweet he
would delay a scheduled tariff hike by two weeks in October.
Export-driven Asian currencies from Taiwan to Australia
rallied on the buoyant mood as the world's two largest economies
each granted concessions in their heated tariff dispute.
The Japanese yen, the go-to safe haven currency for nervous
investors, fell to a six-week low against the dollar. The yen
breached the 108 mark and was last at 107.98 yen per dollar,
down 0.1% on the day and far from its seven-month high of 104.46
plumbed last month.
The Aussie hit a six-week high and the offshore Chinese yuan
rose 0.5% CNH=EBS to a three-week high of 7.0737 against the
dollar.
Market attention now turns to the ECB, the first of a series
of major central bank events, with the Federal Reserve and the
Bank of Japan meeting next week.
Investors almost universally expect a rate cut at Thursday's
ECB meeting as policymakers try to prop up the region's ailing
economy.
The real uncertainty is whether policymakers will restart a
quantitative easing programme after some members of the
governing council in recent weeks expressed doubt about the need
to relaunch asset purchases. SEB strategist Jussi Hiljanen said he expected the ECB to
cut the deposit rate by 10 basis points, extend the forward
guidance on rates by six months and announce the restart of a
quantitative easing programme with monthly purchases lower than
the market anticipated.
"Such a package of stimulus measures would be a
disappointment for the market, pushing long rates higher and
EUR/USD higher and steepening the curve," Hiljanen said.
The single currency EUR=EBS has shed 3.5% since June and
was steady at $1.1017 in early European trade.
The dollar was slightly lower against a basket of currencies
at 98.599 .DXY .
Sterling was little changed GBP=D3 EURGBP=D3 . The pound
rocketed to a six-week high on Monday, reversing last week's
losses as investors welcomed the British parliament's move to
block a no-deal Brexit on Oct. 31.
Despite the more positive mood in risk assets this week,
analysts expressed some caution about its sustainability.
"Just as the presidential tweet on tariffs this morning has
injected more momentum ... we are only one social media posting
away from a thoroughly unpredictable President turning sentiment
on its head," said Jeffrey Halley, senior market analyst for
Asia Pacific at brokerage OANDA.