FOREX-Dollar edges lower ahead of Fed, Evergrande exhale lifts risk-sensitive currencies

    (Corrects quote to note purchase decline in December, not September in paragraph 8)
    By Chuck Mikolajczak
    NEW YORK, Sept 22 (Reuters) - The U.S. dollar slipped ahead of a policy announcement by the Federal
Reserve on Wednesday, while risk-sensitive currencies such as the Australian dollar and Chinese yuan
strengthened after China's Evergrande said it would make a bond coupon payment.
    Property giant and Asia's biggest junk bond issuer Evergrande said it "resolved" one payment
due on Thursday via a private negotiation, easing concerns of default and possible contagion risk, while the
People's Bank of China injected 90 billion yuan into the banking system to support markets.
    "Being able to make tomorrow's bond coupon payment, that definitely lifted risk sentiment overnight and
you saw a typical follow-through reaction in risk currencies, so Canadian dollar high, Aussie dollar higher,
Kiwi dollar higher - that was kind of an understandable reaction," said Erik Bregar, an independent FX
analyst in Toronto.
    Still, uncertainty remains whether the developer will be able to pay the coupon on its offshore dollar
bonds, due on Thursday.
    The Australian dollar rose 0.28% versus the greenback at $0.725 after rising as much as 0.49% to
$0.7268 while the Canadian dollar rose 0.38% versus the greenback at 1.28 per dollar.
    The offshore Chinese yuan strengthened versus the greenback at 6.4628 per dollar.
    All eyes will be on the Fed later in the session for its policy announcement for signs of when the U.S.
central bank plans to begin trimming its monthly asset purchases as well as any insight into the timing of a
possible rate hike.
    "There is definitely a more clear consensus going into this meeting, vis-a-vis the previous one, people
are looking for a more clear timeline on taper, we have all heard these expectations about a signal to start
in November then the actual pace of purchase start declining in December, you could argue expectations are a
tad hawkish coming in," Bregar said.
    The dollar index fell 0.07%, with the euro up 0.09% to $1.1734.
    The safe-haven Japanese yen weakened 0.27% versus the greenback at 109.51 per dollar in the wake of the
Bank of Japan's decision to keep policy on hold.
    Sterling was last trading at $1.3643, down 0.12% on the day ahead of a policy announcement by the
Bank of England on Thursday, with expectations for a rate hike being pushed down the road by investors.
    In cryptocurrencies, Bitcoin last rose 4.58% to $42,457.03 following three straight days of

    Currency bid prices at 10:33AM (1433 GMT)
 Description      RIC         Last           U.S. Close  Pct Change     YTD Pct       High Bid    Low Bid
                                              Previous                   Change
 Dollar index                 93.1420        93.2220     -0.07%         3.513%        +93.2910    +93.1130
 Euro/Dollar                  $1.1736        $1.1726     +0.09%         -3.94%        +$1.1744    +$1.1717
 Dollar/Yen                   109.5150       109.2200    +0.27%         +6.00%        +109.6150   +109.1200
 Euro/Yen                     128.53         128.06      +0.37%         +1.27%        +128.6900   +127.9400
 Dollar/Swiss                 0.9217         0.9236      -0.18%         +4.20%        +0.9250     +0.9217
 Sterling/Dollar              $1.3644        $1.3661     -0.15%         -0.15%        +$1.3678    +$1.3617
 Dollar/Canadian              1.2766         1.2812      -0.34%         +0.27%        +1.2826     +1.2764
 Aussie/Dollar                $0.7252        $0.7233     +0.26%         -5.73%        +$0.7268    +$0.7225
 Euro/Swiss                   1.0816         1.0829      -0.12%         +0.08%        +1.0844     +1.0814
 Euro/Sterling                0.8600         0.8582      +0.21%         -3.76%        +0.8612     +0.8574
 NZ                           $0.7016        $0.7005     +0.18%         -2.28%        +$0.7031    +$0.6994
 Dollar/Norway                8.6310         8.6700      -0.49%         +0.47%        +8.6860     +8.6275
 Euro/Norway                  10.1300        10.1890     -0.58%         -3.22%        +10.1877    +10.1210
 Dollar/Sweden                8.6478         8.6854      -0.38%         +5.51%        +8.6979     +8.6415
 Euro/Sweden                  10.1505        10.1895     -0.38%         +0.74%        +10.1965    +10.1480

 (Reporting by Chuck Mikolajczak; Editing by Will Dunham)

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