Dollar index falls to one-month low Sweden's central bank raises...

• Dollar index falls to one-month low
• Sweden's central bank raises rates, boosts crown
• U.S. repatriation flows slow, pressures dollar
• Graphic: World FX rates in 2018 http://tmsnrt.rs/2egbfVh

(Recasts first paragraph, adds comment, updates prices)

The dollar fell to a more than three-month low against the yen on Thursday, after the Federal Reserve signaled fewer interest rate hikes over the next two years and expressed caution about the U.S. economic outlook.

The dollar index, a measure of the greenback's value against six major currencies, dropped to a one-month low.

Diminished U.S. rate hike expectations lessen the appeal of dollar-denominated assets.

Aside from lowering interest rate forecasts, the Fed also reduced growth and inflation expectations next year.

The Swedish crown SEK= , meanwhile, was one of the biggest gainers on Thursday, up 0.6 percent against the dollar after its central bank raised interest rates for the first time in more than seven years.

In the United States, the two-year/10-year note yield curve - widely considered an indicator of future recessions - flattened to 9 basis points. An inversion of this curve is widely considered a harbinger of recession.

"We think market sentiment will not improve amid a more cautious Fed," said Mazen Issa, senior FX strategist, at TD Securities in New York. "Unresolved trade disputes and an increasingly toxic U.S. political climate suggest further risk reduction is likely."

As result, Issa noted that the safe-haven yen will lead G10 currencies in gains against the U.S. dollar.

The dollar on Thursday fell to 110.82 yen JPY= against the dollar, its lowest since early September, declining for a fifth straight session. It was last down 1.4 percent at 111.13 yen.

In a widely-expected decision, the Bank of Japan on Thursday kept rates steady, maintaining its ultra-loose monetary settings.

The dollar also slid 0.8 percent .DXY against its rivals to 96.263, after earlier dropping to 96.042, its lowest in a month. The index posted its largest daily percentage drop in six weeks.

Diminishing repatriation flows have also dampened the dollar's outlook. They peaked at nearly $300 billion in the first quarter of 2018, but shrank more than two-thirds to $93 billion in the September quarter, according to latest U.S. data.

SWEDISH CROWN SHINES A rate hike by Sweden's Riksbank was not a consensus view in the foreign exchange markets, with a Reuters poll showing two-thirds of analysts expecting the Riksbank to keep rates unchanged. The remainder predicted a tightening.

In other currency pairs, the euro EUR= rose 0.8 percent to $1.1466 EUR= building on gains on Wednesday on news that Italy had struck a deal with the European Commission over its contested 2019 budget and some solid trade data this week.

The euro earlier rose to a six-week high versus the dollar.

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	Currency bid prices at 3:06PM (2006 GMT) 

 Description	  RIC		 Last		   U.S. Close  Pct Change	 YTD Pct	 High Bid	Low Bid 
											  Previous				   Change				  
											  Session											
 Euro/Dollar	  EUR=		$1.1466		$1.1375	 +0.80%		 -4.42%	  +1.1485	 +1.1372 
 Dollar/Yen	   JPY=		111.1200	   112.4700	-1.20%		 -1.38%	  +112.6000   +110.8200 
 Euro/Yen		 EURJPY=	 127.45		 127.95	  -0.39%		 -5.72%	  +128.3700   +127.2300 
 Dollar/Swiss	 CHF=		0.9870		 0.9944	  -0.74%		 +1.30%	  +0.9954	 +0.9841 
 Sterling/Dollar  GBP=		1.2665		 1.2607	  +0.46%		 -6.27%	  +1.2706	 +1.2610 
 Dollar/Canadian  CAD=		1.3494		 1.3483	  +0.08%		 +7.29%	  +1.3530	 +1.3446 
 Australian/Doll  AUD=		0.7116		 0.7107	  +0.13%		 -8.78%	  +0.7148	 +0.7087 
 ar																							  

 Euro/Swiss	   EURCHF=	 1.1315		 1.1313	  +0.02%		 -3.20%	  +1.1349	 +1.1299 
 Euro/Sterling	EURGBP=	 0.9052		 0.9019	  +0.37%		 +1.90%	  +0.9055	 +0.9008 
 NZ			   NZD=		0.6774		 0.6763	  +0.16%		 -4.40%	  +0.6790	 +0.6726 
 Dollar/Dollar																				   

 Dollar/Norway	NOK=		8.6723		 8.7174	  -0.52%		 +5.67%	  +8.7300	 +8.6113 
 Euro/Norway	  EURNOK=	 9.9457		 9.9219	  +0.24%		 +0.99%	  +9.9588	 +9.8810 
 Dollar/Sweden	SEK=		8.9706		 9.0951	  -0.56%		 +9.37%	  +9.0997	 +8.9269 
 Euro/Sweden	  EURSEK=	 10.2897		10.3480	 -0.56%		 +4.57%	  +10.3690	+10.2400 
	<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ 
US yield curve and recessions	http//tmsnrt.rs/2R8aGix 

US company repatriation flows http//tmsnrt.rs/2ScLjK3

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