FOREX-Dollar dips, but sentiment still positive; pound, Aussie up

Wed Jan 22, 2014 10:53am EST
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* UK jobs data drive sterling higher

* Australian dollar jumps as inflation pares rate-cut risk

* Canadian dollar drops to more than 4-year low

By Gertrude Chavez-Dreyfuss

NEW YORK, Jan 22 (Reuters) - The dollar slipped on Wednesday, hurt by gains in sterling and the Australian currency, but the greenback's outlook remained upbeat as the Federal Reserve might be a week away from its next round of reduction in asset buying.

Sterling surged to a three-week high versus the dollar while the Aussie dollar rose to a one-week peak after robust economic numbers that spoke for tighter monetary policy in their economies.

"Sterling and the Aussie dollar are separate issues by themselves, but in terms of the U.S. dollar, the market is still comfortable adding to long positions as the Fed tapering remains on track," said Vassili Serebriakov, currency strategist at BNP Paribas in New York.

Many in the market expect the Fed to slow its monthly bond purchases to a $65 billion pace from $75 billion at its policy meeting next week.   Continued...