FOREX-Upbeat U.S. data lifts dollar; sterling rises

* U.S. third-quarter GDP growth revised higher
* Pound recovers, focus on polls after Conservative lead
narrows

(Updates to U.S. afternoon)
By Saqib Iqbal Ahmed
NEW YORK, Nov 27 (Reuters) - The dollar rose against a
basket of currencies on Wednesday on upbeat U.S. data in subdued
trading as uncertainty about a possible U.S.-China trade deal
lingered during a U.S.-holiday shortened week.
U.S. economic growth picked up slightly in the third
quarter, rather than slowing as initially reported, on a
stronger pace of inventory accumulation and a less steep decline
in business investment. Separate data showed new orders for key U.S.-made capital
goods increased by the most in nine months in October and
shipments rebounded.
"The dollar is definitely supported by the data," said
Alfonso Esparza, senior currency analyst at OANDA in Toronto.
"The Fed has signaled that is done for the year and good
data validates that thinking," he said.
The U.S. Federal Reserve has cut interest rates three times
this year and signaled its credit easing cycle might be on
pause. Signs of U.S. economic strength is giving traders
confidence the central bank will keep borrowing costs unchanged
for now.
"The other thing is that this is basically the end of the
week for U.S. markets and no one wants short dollar exposure
going into the Thanksgiving weekend," Esparza said.
The dollar index .DXY , which compares the greenback
against six other major currencies, was up 0.15% at 98.399.
The index pared gains after U.S. data, excluding volatile
food and energy components, showed the personal consumption
expenditures (PCE) price index edged up 0.1% last month after
being unchanged in September.
"A 0.1% m/m rise in the core PCE deflator left the Fed's
preferred core inflation rate at a well below-target 1.6%. That
underlines that interest rates are unlikely to be raised again
for the foreseeable future," said Andrew Hunter, senior U.S.
economist at Capital Economics.
While recent reports that the United States and China are
close to agreement on the first phase of a trade deal have
helped support risk sentiment, much uncertainty remains about
the outlook for the trade talks.
Lingering trade tensions have generally supported the
greenback as investors view the United States as relatively
well-positioned to weather a full-blown trade war.
The Japanese yen, favored by nervous investors, has faltered
in recent sessions as equity markets soared. On Wednesday, the
dollar gained 0.47% to 109.54 yen.
Sterling was up 0.31% on Wednesday, recovering from early
losses following the third poll in a row that showed a narrowing
lead for the governing Conservative Party before Britain's Dec.
12 election. GBP= Investors awaited the release of the YouGov seat-by-seat
predictions of the election outcome at 5 p.m. EST (2200 GMT).
The multilevel regression and post-stratification model
accurately predicted the 2017 hung parliament.

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(Editing by William Maclean, Ken Ferris, Tom Brown and Richard
Chang)