CORRECTED-FOREX-Dollar gains ahead of Fed meeting; focus on rate outlook

 (Corrects dollar rise in lead paragraph to one-week high,
instead of more than one-week high)
    * Dollar edges up before expected Fed rate hike
    * China cuts import tariffs
    * Euro primed for rebound-Wells Fargo
    * Graphic: World FX rates in 2018 tmsnrt.rs/2egbfVh

    By Gertrude Chavez-Dreyfuss
    NEW YORK, Sept 26 (Reuters) - The dollar rose to a one-week
high on Wednesday before a widely anticipated Federal Reserve
interest rate hike, although investors were still on edge about
a trade spat between the United States and China.
    The Fed is expected to raise interest rates later in the day
for the eighth time since late 2015. Investors are also counting
on another rate increase by the end of the year. The outlook for
2019, however, were less clear. 
    Market participants are likely to focus on the central
bank's policy outlook and any comments on the global trade
dispute.
    "At this time, the consensus view is that the Fed will
remain on a hike-a-quarter (percentage point) path but recent
escalation of trade war rhetoric with China may give Fed
officials pause," said Boris Schlossberg, managing director of
FX strategy at BK Asset Management in New York.
    "Although no one expects Fed Chairman (Jerome) Powell to be
dovish if he focuses on policy being 'data-dependent' rather
than emphasizing the recent spate of growth, the dollar could
take a hit regardless of the rate hike," he added.
    In mid-morning trading, the dollar index, which
measures the U.S. unit against six major currencies, rose 0.3
percent to 94.367. 
    Global markets have been unsettled in the past few months
because of a heated trade dispute between the world's two
largest economies and its possible impact on world growth.
    China on Wednesday said it would cut import tariffs for
products including machinery and electrical equipment as it
braced for an escalation in the trade row with the U.S.

    The cuts are expected to lower costs for consumers and
companies by about 60 billion yuan ($8.73 billion) this year.
    After the announcement, the dollar index rose. 
    The United States imposed fresh tariffs of 10 percent on
$200 billion worth of Chinese goods on Monday, which will rise
to 25 percent by the end of 2018.
    The year began with the dollar retreating, but a hawkish
rate outlook and the U.S.-China trade dispute have made the
greenback a safe haven for investors. In recent weeks, though,
it has lost ground as other economies, such as those in the euro
zone, improved and moved closer to tightening monetary policy.
    The euro traded down 0.4 percent at $1.1730, mainly
due to profit-taking after it touched a 3-1/2-month high on
Monday as European Central Bank President Mario Draghi expressed
confidence in euro zone inflation and wage growth.
    The outlook for the euro has brightened and market
participants are positioning for a rebound.
    "The pieces are steadily falling into place for a more
sustained rebound in the single European currency, including
more favorable capital flow dynamics and more balanced euro
positioning," said Wells Fargo in a research note.
    
    ========================================================
    Currency bid prices at 10:17 AM (1417 GMT)
 Description      RIC         Last           U.S. Close  Pct Change     YTD Pct     High Bid    Low Bid
                                              Previous                   Change                 
                                              Session                                           
 Euro/Dollar      EUR=        $1.1733        $1.1771     -0.32%         -2.19%      +1.1775     +1.1727
 Dollar/Yen       JPY=        112.9700       112.9700    +0.00%         +0.27%      +113.0400   +112.7500
 Euro/Yen         EURJPY=     132.56         132.91      -0.26%         -1.94%      +132.9700   +132.5300
 Dollar/Swiss     CHF=        0.9697         0.9649      +0.50%         -0.47%      +0.9701     +0.9642
 Sterling/Dollar  GBP=        1.3167         1.3181      -0.11%         -2.55%      +1.3191     +1.3139
 Dollar/Canadian  CAD=        1.2965         1.2951      +0.11%         +3.09%      +1.2970     +1.2944
 Australian/Doll  AUD=        0.7246         0.7250      -0.06%         -7.11%      +0.7283     +0.7241
 ar                                                                                             
 Euro/Swiss       EURCHF=     1.1378         1.1352      +0.23%         -2.66%      +1.1385     +1.1342
 Euro/Sterling    EURGBP=     0.8908         0.8924      -0.18%         +0.28%      +0.8945     +0.8908
 NZ               NZD=        0.6644         0.6645      -0.02%         -6.24%      +0.6682     +0.6636
 Dollar/Dollar                                                                                  
 Dollar/Norway    NOK=        8.1107         8.1277      -0.21%         -1.17%      +8.1375     +8.1055
 Euro/Norway      EURNOK=     9.5175         9.5647      -0.49%         -3.36%      +9.5694     +9.5197
 Dollar/Sweden    SEK=        8.8215         8.8071      -0.15%         +7.56%      +8.8416     +8.7888
 Euro/Sweden      EURSEK=     10.3506        10.3660     -0.15%         +5.20%      +10.3826    +10.3463
 
 (Reporting by Gertrude Chavez-Dreyfuss; Additional reporting by
Tom Finn  in London; Editing by Bernadette Baum)
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