News: FOREX-Dollar dips on trade optimism, before Fed meeting

• Trump expects trade deal with China ahead of schedule
• EU agrees to Brexit delay
• Federal Reserve expected to cut rates on Wednesday

(Adds yen move, updates prices)

The U.S. dollar slipped on Monday and the Japanese yen weakened to a three-month low against the greenback as optimism that the U.S. and China will reach a trade deal reduced demand for safe haven currencies, and as investors waited on the Federal Reserve’s meeting this week.

U.S. President Donald Trump said on Monday he expected to sign a significant part of the trade deal with China ahead of schedule but did not elaborate on the timing.

The comments come after the U.S. Trade Representative's office and China's Commerce Ministry said on Friday that U.S. and Chinese officials are "close to finalizing" some parts of a trade agreement, with talks to continue.

The trade war between the U.S. and China has been blamed for adding to global economic weakness, which in turn has prompted central banks globally to cut rates.

"Positive trade headlines continue to support our view that trade tensions are easing," said Win Thin, global head of FX strategy at Brown Brothers Harriman.

The dollar index against a basket of six major currencies .DXY fell 0.07% to 97.760. The yen weakened as far as 109.03, the weakest since Aug. 1. The Australian dollar AUD= , which is highly sensitive to the Chinese economy, rose 0.25% to $0.6839 U.S. dollars.

Hopes that Britain will reach a deal to leave the European Union, and avoid a disorderly exit, also boosted risk sentiment on Monday.

The European Union on Monday agreed to a potential three-month Brexit delay as Prime Minister Boris Johnson sought a snap election to secure a majority capable of passing his divorce deal.

The major U.S. focus this week is the Federal Reserve meeting. The U.S. central bank is expected to cut rates when it concludes its two-day meeting on Wednesday, though investors will be watching for any indication that further cuts are likely.

Fed policymakers are deeply divided on whether the U.S. central bank should continue cutting rates.

"There's still an awful lot of discrepancy and uncertainty in the markets as to what the Fed will do next year,” said Jane Foley, senior FX strategist at Rabobank. "The market will be looking for clues as to which way that might go."

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	Currency bid prices at 2:31PM (1831 GMT) 

 Description	  RIC		 Last		   U.S. Close  Pct Change	 YTD Pct	 High Bid	Low Bid 
											  Previous				   Change				  
											  Session											
 Euro/Dollar	  EUR=		$1.1096		$1.1078	 +0.16%		 -3.25%	  +1.1107	 +1.1077 
 Dollar/Yen	   JPY=		108.9800	   108.6400	+0.31%		 -1.16%	  +109.0300   +108.6700 
 Euro/Yen		 EURJPY=	 120.95		 120.38	  +0.47%		 -4.18%	  +120.9600   +120.4200 
 Dollar/Swiss	 CHF=		0.9947		 0.9943	  +0.04%		 +1.36%	  +0.9970	 +0.9936 
 Sterling/Dollar  GBP=		1.2856		 1.2821	  +0.27%		 +0.78%	  +1.2876	 +1.2812 
 Dollar/Canadian  CAD=		1.3051		 1.3058	  -0.05%		 -4.30%	  +1.3078	 +1.3048 
 Australian/Doll  AUD=		0.6839		 0.6822	  +0.25%		 -2.98%	  +0.6845	 +0.6812 
 ar																							  

 Euro/Swiss	   EURCHF=	 1.1039		 1.1017	  +0.20%		 -1.91%	  +1.1058	 +1.1015 
 Euro/Sterling	EURGBP=	 0.8629		 0.8634	  -0.06%		 -3.95%	  +0.8652	 +0.8616 
 NZ			   NZD=		0.6345		 0.6347	  -0.03%		 -5.54%	  +0.6359	 +0.6335 
 Dollar/Dollar																				   

 Dollar/Norway	NOK=		9.2124		 9.1950	  +0.19%		 +6.64%	  +9.2244	 +9.1800 
 Euro/Norway	  EURNOK=	 10.2257		10.1883	 +0.37%		 +3.23%	  +10.2348	+10.1810 
 Dollar/Sweden	SEK=		9.7063		 9.6836	  +0.40%		 +8.28%	  +9.7077	 +9.6667 
 Euro/Sweden	  EURSEK=	 10.7723		10.7297	 +0.40%		 +4.95%	  +10.7729	+10.7260