- Dollar retreats from 13 1/2-month peak
- Yuan rebounds from weakest since January 2017
- Euro rises from June 2017 lows on reduced risk aversion
- Emerging market currencies rebound, lira strengthens
- Graphic: World FX rates in 2018 http://tmsnrt.rs/2egbfVh
(Updates market action, adds quote)
The U.S. dollar slipped below a 13-1/2 month peak on Thursday, while the Chinese yuan recovered from its weakest level since January 2017 on news China and the United States will hold a new round of trade talks later this month.
The development between the world's two biggest economies offered hope for investors who have been rattled by tit-for-tat tariffs between Beijing and Washington this summer.
Still, doubts persist over whether the talks to be held on Aug. 21-22 would help the nations resolve their trade issues.
"I would say I'm very cautious whether this next round of talks would go anywhere," said Kristina Hooper, chief global strategist at Invesco in New York. "But the market is looking for anything to hold on for a kernel of hope."
The dollar's stalling near its multi-month high came while President Donald Trump praised its recent strength on Thursday, even though he had said a strong greenback puts U.S. exporters at a disadvantage.
"Money is pouring into our cherished DOLLAR like rarely before," Trump wrote on Twitter.
Earlier Thursday, White House economic adviser Larry Kudlow told CNBC television a strong dollar was a sign of confidence.
The ICE index that tracks the greenback against six major currencies .DXY fell as much 0.4 percent before ending 0.06 percent lower on the day at 96.637. It reached 96.984 on Wednesday, which was the highest since June 2017.
The yuan in offshore trading CNH=EBS gained 1.1 percent to 6.8714 per dollar, rebounding from Wednesday's 6.9587, its weakest level since Jan. 4, 2017, EBS data showed.
LIRA'S RECOVERY Market optimism was also stoked by a further recovery in the Turkish lira, whose four-day plunge spurred a flight out of other emerging market currencies and touched off a selloff in the euro due to fears about European banks' exposure to Turkey.
Turkey's lira rose for a third straight day, gaining 2.4 percent to 5.8101 TRYTOM=D3 after Finance Minister Berat Albayrak's presentation to assure international investors.
The lira reduced its earlier gains after U.S. Treasury Secretary Steven Mnuchin said the United States is prepared to impose more sanctions on Ankara if detained American pastor Andrew Brunson is not released.
The lira's bounce on Thursday helped boost the Brazilian real BRL= and Mexican peso MXN=D2 but did little for the Indian rupee INR= and South African rand ZAR= .
The euro EUR=EBS was up over 0.1 percent at $1.13575, edging up from a 13-month low of $1.13010 set on Wednesday.
German Finance Minister Olaf Scholz told Albayrak on Thursday that Germany has an interest in an economically stable Turkey.
On Wednesday, Qatar pledged $15 billion in investments in Turkey, stoking the lira's recovery from a record low.
Concerns remain about President Tayyip Erdogan's policies to combat Turkey's double-digit inflation and his row with Washington over the release of Brunson.
======================================================== Currency bid prices at 2:40PM (1840 GMT)Description RIC Last U.S. Close Pct Change YTD Pct High Bid Low Bid Previous Change Session Euro/Dollar EUR= $1.1365 $1.1343 +0.19% -5.26% +1.1409 +1.1337 Dollar/Yen JPY= 110.8600 110.7300 +0.12% -1.61% +111.1100 +110.4700 Euro/Yen EURJPY= 125.99 125.62 +0.29% -6.80% +126.4800 +125.2900 Dollar/Swiss CHF= 0.9962 0.9934 +0.28% +2.25% +0.9974 +0.9916 Sterling/Dollar GBP= 1.2711 1.2696 +0.12% -5.93% +1.2754 +1.2686 Dollar/Canadian CAD= 1.3160 1.3140 +0.15% +4.64% +1.3173 +1.3113 Australian/Doll AUD= 0.7260 0.7237 +0.32% -6.94% +0.7286 +0.7222 arEuro/Swiss EURCHF= 1.1323 1.1271 +0.46% -3.13% +1.1348 +1.1264 Euro/Sterling EURGBP= 0.8939 0.8937 +0.02% +0.63% +0.8959 +0.8933 NZ Dollar/Dolar NZD= 0.6584 0.6563 +0.32% -7.08% +0.6608 +0.6557 Dollar/Norway NOK= 8.4878 8.4518 +0.43% +3.42% +8.5022 +8.4094 Euro/Norway EURNOK= 9.6469 9.5938 +0.55% -2.05% +9.6560 +9.5747 Dollar/Sweden SEK= 9.2056 9.2037 +0.20% +12.24% +9.2188 +9.1607 Euro/Sweden EURSEK= 10.4629 10.4420 +0.20% +6.34% +10.4722 +10.4320 <^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ President Trump on the U.S. dollar http//reut.rs/2P971NEChina trade balance with the United States and the yuan http//reut.rs/2LWiDoA Turkish lira tumbles, dollar rallies http//reut.rs/2vIIkjh Yuan cross rates http://tmsnrt.rs/1ZRXREu
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