FOREX-Dollar falls to one-month low on weak U.S. data; trade deal in focus

By Gertrude Chavez-Dreyfuss

* U.S. private sector payrolls report misses expectations * U.S. ISM services index falls in November * U.S.-China trade deal still in focus * Sterling gains lifts euro as well * Graphic: World FX rates in 2019 http://tmsnrt.rs/2egbfVh (Recasts adds new comment, U.S. data, FX table, updates prices, changes byline, dateline; previous LONDON) By Gertrude Chavez-Dreyfuss NEW YORK, Dec 4 (Reuters) - The dollar fell to a one-month low on Wednesday, undermined by weaker-than-expected U.S. private sector job growth data that followed soft manufacturing numbers earlier in the week that fueled worries the world's largest economy could slip into recession. The U.S. currency also slid to a four-week trough versus the euro and earlier dipped to a two-week low against the yen before recovering to trade slightly higher on the day. "We have seen big U.S. data misses this week and that doesn't help dollar sentiment," said Shaun Osborne, chief FX strategist at Scotiabank in Toronto. A private survey showed on Wednesday that U.S. private-sector hiring in November unexpectedly slowed to its weakest pace in six months, as goods producers and construction companies cut jobs. U.S. companies' jobs rose by 67,000 last month, the ADP National Employment Report said. The median forecast among economists polled by Reuters called for a gain of 140,000 jobs. "This data is hard to ignore," Scotiabank's Osborne said. "We have seen some slowing in hiring in the U.S. recently. But it's not too surprising given the headwinds for global growth and the slowdown in the U.S." Following the soft payrolls report, data showed that the Institute for Supply Management's non-manufacturing index fell to 53.9 in November from 54.7 the previous month. The weaker-than-expected U.S. services report came after poor U.S. manufacturing data earlier this week. U.S.-China trade negotiations were also in focus on Wednesday. A Bloomberg report that the two sides were close to agreeing on the amount of tariffs that would be rolled back in a phase-one trade deal boosted the offshore-Chinese yuan by 0.2% to 7.05. The Chinese currency had languished around seven-week lows to the dollar after U.S. President Donald Trump said on Tuesday a trade agreement may be delayed until after the November 2020 U.S. presidential election. Overall, the dollar index fell 0.2% to 97.530, after earlier dropping to a one-month low of 97.433. The dollar trades with an 11% premium in times of trade uncertainty, Osborne said, but the greenback seems to have peaked in October as trade tensions have somewhat eased. "It's really gotten to the point where 'people familiar with trade negotiations' are on the ball and there is some progress here and we're going toward some skinny trade deal," Osborne said. "I would expect the dollar to soften." Against the yen, the dollar rose 0.2% to 108.81 yen Sterling gained 0.9% versus the dollar to $1.3118, lifting the euro with it, which rose 0.1% to $1.1091. ======================================================== Currency bid prices at 10:34AM (1534 GMT) Description RIC Last U.S. Close Pct Change YTD Pct High Bid Low Bid Previous Change Session Euro/Dollar EUR= $1.1086 $1.1081 +0.05% -3.34% +1.1115 +1.1067 Dollar/Yen JPY= 108.8500 108.6200 +0.21% -1.28% +108.8700 +108.4400 Euro/Yen EURJPY= 120.69 120.37 +0.27% -4.38% +120.7900 +120.1100 Dollar/Swiss CHF= 0.9882 0.9869 +0.13% +0.69% +0.9894 +0.9856 Sterling/Dollar GBP= 1.3100 1.2992 +0.83% +2.69% +1.3120 +1.2983 Dollar/Canadian CAD= 1.3229 1.3294 -0.49% -2.99% +1.3297 +1.3219 Australian/Doll AUD= 0.6843 0.6846 -0.04% -2.92% +0.6853 +0.6813 ar Euro/Swiss EURCHF= 1.0956 1.0935 +0.19% -2.65% +1.0968 +1.0922 Euro/Sterling EURGBP= 0.8461 0.8527 -0.77% -5.82% +0.8531 +0.8455 NZ NZD= 0.6525 0.6519 +0.09% -2.86% +0.6540 +0.6504 Dollar/Dollar Dollar/Norway NOK= 9.1658 9.1819 -0.18% +6.10% +9.2150 +9.1523 Euro/Norway EURNOK= 10.1630 10.1830 -0.20% +2.59% +10.2126 +10.1524 Dollar/Sweden SEK= 9.5085 9.5314 -0.14% +6.08% +9.5568 +9.4904 Euro/Sweden EURSEK= 10.5440 10.5588 -0.14% +2.73% +10.5920 +10.5380 (Reporting by Gertrude Chavez-Dreyfuss; Additional reporting by Saikat Chatterjee in London; editing by Bill Berkrot)