Dollar edges down as attention turns to Fed leadership

| Updated: October 25, 2017 23:27:52

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The dollar edged down on Tuesday, stepping back from recent highs as market attention turns to who will be the next head of the US central bank.

US President Donald Trump told reporters on Monday he is “very, very close” to deciding who should chair the Federal Reserve after interviewing five candidates for the position.

These include current Fed Chair Janet Yellen, whose term expires in February, as well as Fed Governor Jerome Powell, Stanford University economist John Taylor, Trump’s chief economic advisor Gary Cohn, and former Fed Governor Kevin Warsh.

Investors are also following US tax reform developments. The Senate’s approval of a budget resolution on Friday raised hopes that Trump’s tax plans would move forward this year.

The dollar index, which tracks the greenback against a basket of six major rivals, was down 0.2 per cent at 93.741, moving away from 94.017, which had been its highest since Oct. 6.

The dollar inched 0.1 per cent lower to 113.35 yen, pulling away from a three-month high of 114.10 yen hit in the wake of Sunday’s general election in Japan.

The euro added 0.1 per cent to $1.1762, though its gains were seen capped ahead of the European Central Bank’s policy meeting on Thursday, where the authority is expected to signal it will take small steps away from its ultra-easy monetary policy.

The New Zealand dollar was last down 0.2 per cent at $0.6949, within sight of a five-month low of $0.6932 plumbed on Monday.

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