FOREX-Yuan hits 16-month highs after China data; dollar falls

* China's yuan surges to 16-month high on economic data
* Australian dollar gains
* U.S. dollar edges down
* Graphic: World FX rates in 2020 https://tmsnrt.rs/2RBWI5E

LONDON, Sept 15 (Reuters) - The yuan jumped to its highest
in 16 months versus the dollar on Tuesday after Chinese data
pointed to an economic recovery after coronavirus-linked
shutdowns, while the dollar dipped as risk appetite improved.
China's industrial output accelerated and retail sales grew
for the first time this year, beating analysts' forecasts.
The yuan surged in both offshore and onshore trading. The
offshore yuan hit a 16-month high of 6.7725 versus the U.S.
dollar before easing slightly CNH=EBS .
"Overall, the latest monthly activity data provides
encouragement that positive cyclical momentum in China will be
sustained through the rest of this year," wrote Lee Hardman,
currency analyst at MUFG.
He said the data was "a supportive development for Asian and
commodity-related currencies such as the Australian dollar."
The U.S. dollar slipped, although it recovered some of its
overnight losses in early London trade leaving the dollar index
=USD 0.1 percent lower on the day at 92.946 by 0718 GMT.
U.S. industrial production data is due at 1315 GMT, while
the market is looking ahead to the Federal Reserve's two-day
policy meeting starting on Wednesday. "Another good August industrial production figure out of the
U.S. today should maintain the positive mood going into
tomorrow's FOMC meeting," wrote ING strategists in a note to
clients, adding the dollar index could still drift down to
92.50.
Riskier currencies gained, with sentiment also boosted by
hopes for a COVID-19 vaccine.
British drugmaker AstraZeneca restarted its vaccine trial in
Britain on Saturday but it remains on hold in the United
States. The Australian dollar rose after the country's central bank
meeting minutes showed no signs of a further cut to record-low
interest rates. It was at 0.7323, up 0.5% on the day AUD=D3 .
Australia recorded its first day without a COVID-19 death in
two months. The New Zealand dollar was up 0.3% versus the U.S. dollar
NZD=D3 , while the Canadian dollar rose around 0.2% CAD=D3 .
The Swedish crown was up around 0.1% at 8.754 SEK=D3 while
the Norwegian crown fell around 0.3% NOK=D3 , taking a hit as
oil prices extended their fall. The euro was up 0.2% versus the dollar at $1.1891 EUR=EBS .
Germany's ZEW economic sentiment survey is due at 0900 GMT.
The pound showed little reaction to the UK government
winning an initial vote on its controversial Brexit bill.
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