News: FOREX-Dollar hits 19-month peak on gloom outside U.S.

• Weak German, French PMIs stoke selling in euros
• Yuan falters on dour Chinese retail sales, industrial data
• Worries about Brexit deal knocks down sterling
• Graphic: World FX rates in 2018 http://tmsnrt.rs/2egbfVh

(Updates market action, changes dateline, previous LONDON)

The dollar shone on Friday, reaching a 19-month high against a basket of currencies, as investors preferred the safety of the world's reserve currency in the wake of worrisome political and economic news outside the United States.

The Chinese yuan CNH= fell after data showed retail sales grew in November at their slowest pace since 2003 and industrial output rose the least in nearly three years. The offshore yuan CNH=EBS shed 0.38 percent at 6.9038 per dollar.

The euro weakened as the euro zone economy showed more signs of a slowdown.

Sterling tumbled as traders worried British Prime Minister Theresa May was struggling to secure assurances from the EU over her Brexit withdrawal deal.

"The dollar is not so much rallying as much as everyone else is falling," said Boris Schlossberg, managing director of FX strategy at BK Asset Management in New York.

An index that tracks the greenback versus six major peers .DXY hit its highest level since May 2017 at 97.711. At 11:02 a.m. (1602 GMT), it was up 0.49 percent at 97.536.

The greenback's appeal increased in the aftermath of upbeat data on domestic retail sales and industrial output.

The dollar's gains were limited by bets the Federal Reserve might reduce the number of interest rate increases after a widely expected hike next week.

The futures market implied traders saw an 82 percent chance the U.S. central bank would increase key short-term rates by a quarter point to 2.25-2.50 percent at its policy meeting next Tuesday and Wednesday, up from 79 percent on Thursday, according to CME Group's FedWatch program.

"The market is skeptical about the U.S. economy and whether the Fed would hike further after December," Schlossberg said.

The greenback was also held back by the probability of a partial government shutdown as U.S. President Donald Trump and federal lawmakers disagree over funding for a border wall, analysts said.

The euro was down 0.5 percent at $1.12965 after German data showed private-sector expansion slowed to a four-year low in December. French business activity unexpectedly contracted, further fanning fears about slowing growth in the euro area.

Worries about the European economy were also stoked by uncertainty whether May could convince the British parliament to approve her Brexit deal.

The pound was 0.79 percent lower at $1.256, holding above a 20-month low of $1.2477 reached on Wednesday.

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	Currency bid prices at 11:04AM (1604 GMT) 

 Description	  RIC		 Last		   U.S. Close  Pct Change	 YTD Pct	 High Bid	Low Bid 
											  Previous				   Change				  
											  Session											
 Euro/Dollar	  EUR=		$1.1296		$1.1361	 -0.57%		 -5.84%	  +1.1371	 +1.1270 
 Dollar/Yen	   JPY=		113.4400	   113.6200	-0.16%		 +0.68%	  +113.6800   +113.4000 
 Euro/Yen		 EURJPY=	 128.14		 129.03	  -0.69%		 -5.21%	  +129.1200   +128.0700 
 Dollar/Swiss	 CHF=		0.9966		 0.9940	  +0.26%		 +2.29%	  +0.9983	 +0.9932 
 Sterling/Dollar  GBP=		1.2558		 1.2655	  -0.77%		 -7.06%	  +1.2674	 +1.2531 
 Dollar/Canadian  CAD=		1.3373		 1.3350	  +0.17%		 +6.33%	  +1.3401	 +1.3347 
 Australian/Doll  AUD=		0.7171		 0.7226	  -0.76%		 -8.08%	  +0.7228	 +0.7152 
 ar																							  

 Euro/Swiss	   EURCHF=	 1.1256		 1.1287	  -0.27%		 -3.70%	  +1.1295	 +1.1243 
 Euro/Sterling	EURGBP=	 0.8992		 0.8974	  +0.20%		 +1.23%	  +0.9006	 +0.8961 
 NZ Dollar/Dolar  NZD=		0.6802		 0.6856	  -0.79%		 -4.01%	  +0.6862	 +0.6779 
 Dollar/Norway	NOK=		8.6190		 8.5552	  +0.75%		 +5.02%	  +8.6337	 +8.5507 
 Euro/Norway	  EURNOK=	 9.7360		 9.7232	  +0.13%		 -1.14%	  +9.7479	 +9.7158 
 Dollar/Sweden	SEK=		9.0682		 9.0551	  -0.42%		 +10.56%	 +9.1164	 +9.0532 
 Euro/Sweden	  EURSEK=	 10.2437		10.2871	 -0.42%		 +4.11%	  +10.3114	+10.2420