September 16, 2019 / 3:58 PM / a month ago

FOREX-Dollar rises as Trump approves oil stockpile use after Saudi attacks

    * Oil pares gains as Trump okays emergency oil reserve use
    * Safe-haven yen, Swiss franc trim initial increases
    * Currencies of oil exporters Norway, Canada gain 
    * Short-covering seen lifting greenback before Fed meeting 
    * Graphic: World FX rates in 2019

 (Updates market action, changes dateline, previous LONDON)
    By Richard Leong
    NEW YORK, Sept 16 (Reuters) - The dollar rose against a
basket of currencies on Monday as U.S. President Donald Trump's
authorization of the use of an emergency crude stockpile in
response to drone attacks on Saudi Arabian refining facilities
cooled a surge in oil prices.
    The Japanese yen and Swiss franc, both traditional
safe-haven currencies, gave up much of their initial gains with
a pullback in crude prices and anxiety about a disruption in
global energy supply, analysts said. 
    Still, investors remained nervous about another attack,
which underpinned demand for currencies of oil exporters such as
Norway and Canada.
    "The market took it yet with another shrug," said Boris
Schlossberg, managing director of FX strategy with BK Asset
Management in New York. "If you see another attack, there might
be another reaction."
    Oil prices had jumped as much as 19% in reaction to the
drone strikes, which knocked out more than 5% of global oil
output. Yemen's Iran-aligned Houthi group claimed
responsibility, but the United States has blamed Tehran.
    On Sunday, Trump said he had authorized the release of oil
from the U.S. Strategic Petroleum Reserve (SPR) if needed in a
quantity to be determined. He also said Washington was "locked
and loaded" to retaliate for the attacks on the Saudi
    Another factor boosting the greenback was some exiting of
bearish dollar bets in advance of the U.S. Federal Reserve's
two-day policy meeting. Traders widely expect the Fed will cut
interest rates by a quarter of a percentage point this week.
    In July, Fed policymakers lowered short-term rates for the
first time since 2008.
    "The market wants to short-cover in front of the Fed if the
Fed doesn't cooperate," Schlossberg said.
    On the other hand, speculators trimmed their bullish bets on
the dollar, according to the latest data from the Commodity
Futures Trading Commission. 
    At 11:31 a.m. (1531 GMT), an index that tracks the greenback
against the euro, yen, sterling and three other currencies
 was up 0.38% at 98.63. It touched its lowest level since
Aug. 27 on Friday.
    The dollar was -0.05% lower at 108.045 yen,
recovering from an earlier low of 107.44 during Asian trading.
    The greenback fell to 98.655 Swiss francs before
reversing to trade at 99.29, up 0.29% on the day.
    Among currencies tied to oil-exporting countries, the
Norwegian crown strengthened to 8.9179 per dollar
earlier before retreating to 8.965.
    The Canadian dollar rose 0.3% to C$1.3249 after
earlier reaching C$1.3208.
    The Russian ruble was 0.3807% higher.     
    Sterling, which has soared over the past week on growing
investor confidence that a no-deal Brexit is off the table, fell
back from a two-month high to $1.2418, down 0.68% on
the day. It was little changed against the euro to 88.565 pence
    Currency bid prices at 11:32AM (1532 GMT)
 Description      RIC         Last           U.S. Close  Pct Change     YTD Pct     High Bid    Low Bid
                                              Previous                   Change                 
 Euro/Dollar      EUR=        $1.0996        $1.1073     -0.70%         -4.12%      +1.1091     +1.0994
 Dollar/Yen       JPY=        108.0500       108.0700    -0.02%         -2.00%      +108.0900   +107.4800
 Euro/Yen         EURJPY=     118.84         119.69      -0.71%         -5.85%      +119.5000   +118.7000
 Dollar/Swiss     CHF=        0.9928         0.9902      +0.26%         +1.16%      +0.9939     +0.9866
 Sterling/Dollar  GBP=        1.2415         1.2500      -0.68%         -2.68%      +1.2509     +1.2400
 Dollar/Canadian  CAD=        1.3247         1.3283      -0.27%         -2.86%      +1.3270     +1.3207
 Australian/Doll  AUD=        0.6864         0.6877      -0.19%         -2.62%      +0.6884     +0.6855
 Euro/Swiss       EURCHF=     1.0919         1.0961      -0.38%         -2.98%      +1.0964     +1.0915
 Euro/Sterling    EURGBP=     0.8855         0.8858      -0.03%         -1.44%      +0.8902     +0.8850
 NZ               NZD=        0.6355         0.6375      -0.31%         -5.39%      +0.6391     +0.6351
 Dollar/Norway    NOK=        8.9644         8.9860      -0.24%         +3.77%      +8.9892     +8.9179
 Euro/Norway      EURNOK=     9.8589         9.9515      -0.93%         -0.48%      +9.9299     +9.8607
 Dollar/Sweden    SEK=        9.6751         9.6075      -0.01%         +7.94%      +9.6918     +9.5968
 Euro/Sweden      EURSEK=     10.6413        10.6422     -0.01%         +3.68%      +10.6760    +10.6348

 (Additional reporting by Tommy Wilkes in LONDON
Editing by Larry King and Paul Simao)
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