* Graphic: World FX rates in 2019
By Saikat Chatterjee
LONDON, May 22 (Reuters) - The Japanese yen and the Swiss franc
firmed on Wednesday as risk appetite remained weak in the backdrop of
festering trade tensions between the United States and China.
While risky assets heaved a sigh of relief overnight after the
United States eased trade restrictions on Chinese telecommunications
equipment maker Huawei Technologies, the lack of a significant
breakthrough has kept investors on edge.
"We are still skeptical over a long-lasting recovery,"
said Charalambos Pissouros, a senior markets analyst at JFD group.
"Before we get confident on that front, we would like to see
concrete signs that both the US and China are truly willing find
Against a basket of key rival currencies, the dollar was largely
steady at 98.031 , having brushed a 3-1/2-week high of 98.134
overnight. The index has risen 1.9% this year.
The Japanese yen and the Swiss franc remained firm against
the dollar with both currencies set to gain nearly one percent so far
this month against the greenback signaling investors were broadly
dialing back on risky assets.
However, MUFG Bank's chief currency strategist Minori Uchida said
he expected demand for the U.S. currency to remain strong on a need
for dollar funding among emerging markets and on investor cautiousness
due to the Sino-U.S. trade dispute.
"Even if yields fall, that's not likely to put a big dent in
the dollar's rise," he said.
Sterling was the only notable loser in the early European session
with the British currency falling 0.3% to a fresh four-month low
against the dollar at $1.2663.
Political uncertainty in Britain deepened as Prime Minister
Theresa May's final attempt to seal a Brexit deal failed to win over
either opposition lawmakers or many in her own party.
Elsewhere in the foreign exchange market, the euro was steady
at $1.1162 before a speech by European Central Bank chief Mario Draghi
(Reporting by Saikat Chatterjee; Additional reporting by Daniel
Leussink in TOKYO; Editing by Toby Chopra)
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