* Dollar edges lower after Friday's jump
* China makes surprise 10 bps MLF cut
LONDON, Jan 17 (Reuters) - The dollar edged lower on Monday
as traders took the view that Federal Reserve tightening moves
were largely priced in, while the euro eased from Fridays
An unexpected cut to key lending rates in China highlighted
it as the outlier, with other major central banks in talks to
raise rates. China's move only briefly weighed on the yuan.
The U.S. dollar index, which declined sharply last
week until Friday's leap, edged down 0.1% at 95.076 at 0900 GMT.
The cash Treasury market was closed for a holiday on Monday.
"With 3.7 Fed rate hikes priced in for 2022 and 2.3 for
2023, market participants seem to be inferring that the risks to
policy pricing are now more balanced," Goldman Sachs told
The Fed meets on Jan. 25-26 and is not expected to move
The euro rose 0.1% versus the dollar at $1.1432,
with no major economic data on the calendar this week, investors
will focus on speeches from President Christine Lagarde and
other ECB members, ING analysts said.
European Central Bank President Christine Lagarde said on
Friday, the bank is ready to take any measures necessary to get
inflation down to its 2% target. Inflation rose to 5% last
month, the highest on record for the 19-country currency bloc.
ECB board member Isabel Schnabel said in remarks published
on Friday that raising interest rates in the euro zone would not
push down soaring energy prices.
Elsewhere, momentum for tightening is rising. Even the
ultra-accommodative Bank of Japan is debating how soon to begin
telegraphing hike plans.
The outlier is China, where a slew of economic data
confirmed the deadening effect of coronavirus restrictions on
consumer spending, prompting Beijing to ease monetary policy.
The yuan initially faded slightly as government bonds
rallied on the rate cut, before firming at 6.3475 per dollar
UK inflation data on Wednesday could help extend a
month-long rally in sterling. It was flat at $1.3679
versus the dollar, after climbing last week to its highest since
(Reporting by Joice Alves, editing by Ed Osmond)