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FOREX-Euro stands firm ahead of inflation gauge, Lagarde speech

       By Tom Westbrook
    SINGAPORE, June 28 (Reuters) - The euro held onto its recent
gains on Tuesday ahead of European inflation figures this week
that are expected to run hot and a speech from central bank
chief Christine Lagarde, while a rally in oil prices boosted
commodity currencies.
    The euro rose 0.28% overnight and at one point poked
above its 50-day moving average. It last sat at $1.0574.
    The dollar held modest overnight gains on other currencies
and traded at 135.33 yen and $0.693 per Australian
dollar in the Asia session.
    German inflation figures are due on Wednesday, French data
on Thursday and euro zone numbers on Friday. European Central
Bank President Lagarde is also due to speak at the ECB forum in
Sintra, Portugal, at 0800 GMT on Tuesday.
    "This set of inflation data will have a significant
influence on the ECB's monetary policy forward guidance,
especially on the trajectory ... of its interest rate hike cycle
that is expected to kick start in July," said CMC analyst Kelvin
    Hike expectations have the euro trading firmly against the
yen, and it last bought 143.1 yen close to last week's
seven-year high of 144.24.
     It also has momentum on sterling and has gained
1.2% this month to 86.18 pence.
    The weak spot is against the Swiss franc which has
rocketed to test parity on the common currency following a
surprise rate hike by the Swiss National Bank earlier in June.
    Elsewhere, a third straight day of gains for oil helped the
Canadian dollar reach C$1.2858 versus its U.S
equivalent, its highest in a fortnight. It also lent support to
the Norwegian crown at 9.79 per dollar just off a
two-week peak hit overnight.
    At the other end of the dial, higher oil prices caused the
partially convertible Indian rupee to open at a record
low, and fall further to 78.67 per dollar.
    Other moves were modest as traders try and navigate between
relief that signs of weakness in recent global economic data can
moderate rate hikes, and worry that it could be a harbinger of
the onset of a difficult period of stagflation.
    Some of the heat has come out of bets on U.S. interest rate
rises, with the peak in the Federal Reserve's benchmark funds
rate now seen hovering around 3.5% next year rather than 4% or
above, but the dollar has not yet fallen far from lofty peaks.
    The U.S. dollar index struck a two-decade high of
105.79 this month and was last steady at 103.93.
    The risk-sensitive Australian and New Zealand dollars have
been left behind in last week's stock market bounce. The kiwi
 was steady at $0.6295 on Tuesday.
    Sterling was similarly becalmed at $1.2268.
    "Stay long the dollar until some of the uncertainty has
reduced," said Societe Generale strategist Kit Juckes.
    "The dollar will fall likely only when the global economy is
on a more sustainable growth path ... markets are
forward-looking, but all we can see ahead today is danger."

    Currency bid prices at 0525 GMT
 Description      RIC         Last           U.S. Close  Pct Change     YTD Pct     High Bid    Low Bid
                                              Previous                   Change
 Euro/Dollar                  $1.0576        $1.0583     -0.06%         -6.97%      +1.0586     +1.0571
 Dollar/Yen                   135.3000       135.4600    -0.08%         +17.68%     +135.5850   +135.1600
 Euro/Yen         Dollar/Swiss                 0.9559         0.9562      +0.00%         +4.83%      +0.9567     +0.9555
 Sterling/Dollar              1.2271         1.2265      +0.06%         -9.26%      +1.2283     +1.2262
 Dollar/Canadian              1.2858         1.2872      -0.11%         +1.70%      +1.2878     +1.2858
 Aussie/Dollar                0.6928         0.6925      +0.08%         -4.66%      +0.6938     +0.6916
 NZ                           0.6293         0.6302      -0.15%         -8.07%      +0.6307     +0.6292

All spots
Tokyo spots
Europe spots
Tokyo Forex market info from BOJ

 (Reporting by Tom Westbrook, additional reporting by Alun John;
Editing by Jacqueline Wong)

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