FOREX-Dollar drops to fresh 2-1/2-year low on continued stimulus optimism

* Mnuchin says Trump would sign McConnell stimulus deal

* U.S. ADP (NASDAQ:ADP) report shows slowing private sector hiring

* Euro hits fresh 2-1/2-year peak

* Sterling falls on negative Brexit headline

* Graphic: World FX rates in 2020 https://tmsnrt.rs/2RBWI5E (Recasts, adds new analyst comment, U.S. ADP data, FX table, updates prices, previous LONDON)

By Gertrude Chavez-Dreyfuss and Suzanne Barlyn

NEW YORK, Dec 2 (Reuters) - The safe-haven dollar sank to a fresh 2-1/2-year low on Wednesday, pressured once again by expectations of further fiscal stimulus for the United States.

A proposed bipartisan coronavirus pandemic-related economic stimulus package on Tuesday worth $908 billion as well as COVID-19 aid talks between U.S. Treasury Secretary Steve Mnuchin and House of Representatives Speaker Nancy Pelosi lifted the market's appetite for risk and pushed the dollar to its lowest level since April 2018. That trend continued on Wednesday.

Mnuchin said President Donald Trump would sign a pandemic relief deal proposed by Senate Majority Leader Mitch McConnell. months, McConnell has been pushing for a $500 billion approach that Democrats rejected as insufficient. The plan includes $332.7 billion in new loans or grants to small businesses, according to a document provided to Reuters. momentum for a weaker dollar should continue, said Vassili Serebriakov, an FX strategist at UBS in New York. "Any bounces in the dollar are likely to find sellers."

In mid-morning trading, the dollar index, which measures the greenback against a basket of major currencies, was flat to slightly lower to 91.160 =USD , after hitting 91.100, the lowest level since late April 2018 hit overnight.

Data showing slower U.S. private hiring last month also supported some safe-haven buying of the dollar.

Private payrolls increased by 307,000 jobs in November, the ADP National Employment Report showed on Wednesday, lower than economists' forecasts of a 410,000 rise in new jobs. Data for October, though, was revised up to show 404,000 jobs added instead of the initially reported 365,000. approval of a COVID-19 vaccine and the possibility that U.S. unemployment data will help spur a pandemic relief package in Washington are likely to support investors' risk tolerance, driving them away from the dollar, Serebriakov said.

Britain approved Pfizer (NYSE:PFE)'s PFE.N COVID-19 vaccine on Wednesday, jumping ahead of the rest of the world in the race to begin the most crucial mass inoculation program in history. euro, meanwhile, was up 0.2% at $1.2095 EUR=EBS , after earlier hitting $1.2108, the highest since April 2018.

The European Central Bank meets next week, and analysts said the euro could be pressured as investors worry the ECB will act to curb its rapid rise.

Against the yen, the dollar rose 0.2% to 104.47 JPY=EBS .

The Bank of Japan's deputy governor signaled that the central bank was ready to extend pandemic-response programs, saying it would "take additional easing steps without hesitation as needed." was up 0.6% at $18,850 BTC=BTSP , after hitting a record high of $19,918.01 on Tuesday.

The British pound fell after news headlines saying Britain's post-Brexit trade deal with the European Union "still hangs in balance." GBP/

The pound last traded down 0.7% against the dollar at $1.3324 GBP=D3 .

The risk-sensitive Aussie dollar turned slightly higher to US$0.7375 AUD=D3 . It bounced in Asia as data showed Australia's economy rebounded more than expected in the third quarter AUD=D3 . bid prices at 10:37AM (1537 GMT) Description

RIC

Last

U.S. Close Pct Change

YTD Pct

High Bid

Low Bid

Previous

Change

Session

Dollar index

=USD

$91.1620

91.1880

-0.02%

+0.00%

+91.5040

+91.1000 Euro/Dollar

EUR=EBS

$1.2095

$1.2072

+0.19%

+7.88%

+1.2109

+1.2040 Dollar/Yen

JPY=D3

104.4500

104.3200

+0.15%

-3.81%

+104.7450 +104.3350 Euro/Yen

EURJPY=

126.32

125.91

+0.33%

+3.58%

+126.4700 +125.7800 Dollar/Swiss

CHF=EBS

0.8955

0.8999

-0.51%

-7.48%

+0.9013

+0.8943 Sterling/Dollar GBP=D3

1.3330

1.3425

-0.70%

+0.51%

+1.3439

+1.3288 Dollar/Canadian CAD=D3

1.2936

1.2934

+0.02%

-0.42%

+1.2958

+1.2917 Aussie/Dollar

AUD=D3

0.7381

0.7371

+0.12%

+5.18%

+0.7393

+0.7351 Euro/Swiss

EURCHF=

1.0829

1.0858

-0.27%

-0.21%

+1.0871

+1.0814 Euro/Sterling

EURGBP=

0.9071

0.8991

+0.89%

+7.30%

+0.9085

+0.8987 NZ

NZD=D3

0.7049

0.7067

-0.25%

+4.76%

+0.7083

+0.7032 Dollar/Dollar

Dollar/Norway

NOK=D3

8.8310

8.8265

+0.08%

+0.70%

+8.8940

+8.8000 Euro/Norway

EURNOK=

10.6813

10.6250

+0.53%

+8.57%

+10.7280

+10.6181 Dollar/Sweden

SEK=

8.4994

8.4787

+0.53%

-9.07%

+8.5480

+8.4727 Euro/Sweden

EURSEK=

10.2800

10.2256

+0.53%

-1.81%

+10.2950

+10.2360