News: FOREX-Dollar slips as easing curbs in China buoys risk sentiment

SINGAPORE, Dec 5 (Reuters) - The dollar slid across the board on Monday after a bruising week, weakening to below 7 yuan as sentiment toward riskier, non-dollar assets improved following signs of China easing some of COVID related restrictions.
More Chinese cities, including financial hub Shanghai and Urumqi in the far west, announced an easing of coronavirus curbs over the weekend as China tries to soften its stance on COVID-19 restrictions in the wake of unprecedented protests against the policy.
"It may seem like they are baby steps but nonetheless quite a strong sign of China taking calibrated steps in the direction of reopening," said Christopher Wong, a currency strategist at OCBC.
China is soon set to announce a nationwide easing of testing requirements as well as allowing positive cases and close contacts to isolate at home under certain conditions, people familiar with the matter told Reuters last week.
The dollar slipped under 7.0 yuan in offshore trade CNH= , while the onshore yuan CNY=CFXS jumped roughly 1.4% to as high as 6.9507 on Monday morning, its strongest since Sept. 13.
The dollar index =USD , which measures the currency against six major peers including the yen and euro, was down 0.18% at 104.28, its lowest since June 28.
The index fell 1.4% last week, capping off 5% drop for the month of November, its worst month since 2010, due to increasing expectations that the Federal Reserve is set to dial down the pace of its interest rate hikes after four consecutive 75 basis points increases.
Investors' focus will be on U.S. consumer price inflation data due out on Dec. 13, one day before the Fed concludes its two-day policy meeting.
The U.S. central bank is expected to increase policy rates by an additional 50 basis points at the meeting. Fed funds futures traders are now pricing for the Fed's benchmark rate to peak at 4.92% in May. FEDWATCH
OCBC's Wong said some degree of caution is still warranted as the Fed is not done tightening. "They are still tightening, it's just that it is going to be in small steps."
Traders appeared to look past stronger-than-anticipated U.S. payrolls report for November on Friday after some of the Fed speakers allayed market concerns.
"We move past U.S. payrolls with only a momentary shake for risky markets," said Chris Weston, head of research at Pepperstone, noting that the data supported the 'soft landing' argument and is unlikely to change the Fed's course.
Meanwhile, the Japanese yen JPY=EBS weakened 0.04% versus the greenback at 134.37 per dollar, having gained 3.5% last week, far off October's low of 151.94.
The euro EUR=EBS rose 0.38% to $1.0578, having gained 1.3% last week. It had earlier touched a more than five month high of $1.05835.
Sterling GBP= rose to $1.23450, its highest since June 17, and was last trading at $1.2339, up 0.42%.
The Australian dollar AUD=D3 rose 0.75% to $0.684, while the kiwi NZD=D3 was 0.31% higher at $0.643.
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	Currency bid prices at 0520 GMT 
 Description	  RIC		 Last		   U.S. Close  Pct Change	 YTD Pct	 High Bid	Low Bid 
											  Previous				   Change				  
											  Session											
 Euro/Dollar	   EUR=EBS	$1.0580		$1.0541	 +0.37%		 -6.94%	  +1.0584	 +1.0512 
 Dollar/Yen		JPY=EBS	134.3800	   134.2950	+0.00%		 +16.75%	 +134.7600   +134.2800 
 Euro/Yen		 																			 
 Dollar/Swiss	  CHF=EBS	0.9349		 0.9368	  -0.19%		 +2.51%	  +0.9393	 +0.9344 
 Sterling/Dollar   GBP=D3	 1.2337		 1.2293	  +0.37%		 -8.76%	  +1.2343	 +1.2251 
 Dollar/Canadian   CAD=D3	 1.3401		 1.3474	  -0.54%		 +5.99%	  +1.3473	 +1.3386 
 Aussie/Dollar	 AUD=D3	 0.6841		 0.6794	  +0.63%		 -5.94%	  +0.6851	 +0.6764 
 NZ				NZD=D3	 0.6429		 0.6413	  +0.27%		 -6.06%	  +0.6442	 +0.6367 
 Dollar/Dollar																				   
All spots FX= Tokyo spots AFX= Europe spots EFX= Volatilities FXVOL= Tokyo Forex market info from BOJ TKYFX
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World FX rates	https://tmsnrt.rs/2RBWI5E 
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