FOREX-Dollar weak as US tax plan, Powell confirmation eyed

NEW YORK, Nov 27 (Reuters) - The dollar fell against a basket of other major currencies on Monday as traders braced for the resumption of deliberations on the U.S. tax plan and the confirmation hearing for Federal Reserve Governor Jerome Powell as the central bank's next chair.

The dollar index, which measures the greenback against six rival currencies, was down 0.06 percent at 92.724, after hitting a nine-week low of 92.496 earlier in the session.

Trump nominates Jerome Powell as chair of the Federal Reserve:

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Trump nominates Jerome Powell to lead U.S. Federal Reserve
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Trump nominates Jerome Powell to lead U.S. Federal Reserve
US President Donald Trump shakes hands as he announces his nominee for Chairman of the Federal Reserve, Jerome Powell, in the Rose Garden of the White House in Washington, DC, November 2, 2017. / AFP PHOTO / SAUL LOEB (Photo credit should read SAUL LOEB/AFP/Getty Images)
US President Donald Trump announces his nominee for Chairman of the Federal Reserve, Jerome Powell (L), in the Rose Garden of the White House in Washington, DC, November 2, 2017. / AFP PHOTO / SAUL LOEB (Photo credit should read SAUL LOEB/AFP/Getty Images)
US President Donald Trump announces his nominee for Chairman of the Federal Reserve, Jerome Powell (L), in the Rose Garden of the White House in Washington, DC, November 2, 2017. / AFP PHOTO / SAUL LOEB (Photo credit should read SAUL LOEB/AFP/Getty Images)
Jerome Powell listens as US President Donald Trump announces Powell as nominee for Chairman of the Federal Reserve in the Rose Garden of the White House in Washington, DC, November 2, 2017. / AFP PHOTO / SAUL LOEB (Photo credit should read SAUL LOEB/AFP/Getty Images)
Jerome Powell listens as US President Donald Trump announces Powell as nominee for Chairman of the Federal Reserve in the Rose Garden of the White House in Washington, DC, November 2, 2017. / AFP PHOTO / SAUL LOEB (Photo credit should read SAUL LOEB/AFP/Getty Images)
U.S. President Donald Trump announces Jerome Powell as his nominee to become chairman of the U.S. Federal Reserve in the Rose Garden of the White House in Washington, U.S., November 2, 2017. REUTERS/Carlos Barria
US President Donald Trump announces his nominee for Chairman of the Federal Reserve, Jerome Powell, in the Rose Garden of the White House in Washington, DC, November 2, 2017. / AFP PHOTO / SAUL LOEB (Photo credit should read SAUL LOEB/AFP/Getty Images)
U.S. President Donald Trump, left, and Jerome Powell, governor of the U.S. Federal Reserve and Trump's nominee for chairman of the Federal Reserve, walk to a nomination announcement in the Rose Garden of the White House in Washington, D.C., U.S., on Thursday, Nov. 2, 2017. If approved by the Senate, the 64-year-old former Carlyle Group LP managing director and ex-Treasury undersecretary would succeed Janet Yellen. Photographer: Andrew Harrer/Bloomberg via Getty Images
Jerome Powell (R) speaks after being nominated for Chairman of the Federal Reserve by US President Donald Trump (L) in the Rose Garden of the White House in Washington, DC, November 2, 2017. / AFP PHOTO / SAUL LOEB (Photo credit should read SAUL LOEB/AFP/Getty Images)
US President Donald Trump announces his nominee for Chairman of the Federal Reserve, Jerome Powell, in the Rose Garden of the White House in Washington, DC, November 2, 2017. / AFP PHOTO / SAUL LOEB (Photo credit should read SAUL LOEB/AFP/Getty Images)
US President Donald Trump (L) signals the end of ceremony after announcing Jerome Powell (R) as nominee for Chairman of the Federal Reserve in the Rose Garden of the White House in Washington, DC, November 2, 2017. / AFP PHOTO / SAUL LOEB (Photo credit should read SAUL LOEB/AFP/Getty Images)
Jerome Powell (R) speaks after being nominated for Chairman of the Federal Reserve by US President Donald Trump (L) in the Rose Garden of the White House in Washington, DC, November 2, 2017. / AFP PHOTO / SAUL LOEB (Photo credit should read SAUL LOEB/AFP/Getty Images)
US President Donald Trump walks with Jerome Powell, his nominee to be Federal Reserve chairman, at the White House in Washington, DC, on November 2, 2017. / AFP PHOTO / NICHOLAS KAMM (Photo credit should read NICHOLAS KAMM/AFP/Getty Images)
US President Donald Trump walks with Jerome Powell, his nominee to be Federal Reserve chairman, at the White House in Washington, DC, on November 2, 2017. / AFP PHOTO / NICHOLAS KAMM (Photo credit should read NICHOLAS KAMM/AFP/Getty Images)
US President Donald Trump walks with Jerome Powell, his nominee to be Federal Reserve chairman, at the White House in Washington, DC, on November 2, 2017. / AFP PHOTO / NICHOLAS KAMM (Photo credit should read NICHOLAS KAMM/AFP/Getty Images)
Jerome Powell (R) leaves with US President Donald Trump leave after he was nominated for Chairman of the Federal Reserve in the Rose Garden of the White House in Washington, DC, November 2, 2017. / AFP PHOTO / SAUL LOEB (Photo credit should read SAUL LOEB/AFP/Getty Images)
US President Donald Trump shakes hands with his nominee for Chairman of the Federal Reserve, Jerome Powell (R), in the Rose Garden of the White House in Washington, DC, November 2, 2017. / AFP PHOTO / SAUL LOEB (Photo credit should read SAUL LOEB/AFP/Getty Images)
U.S. President Donald Trump arrives shakes hands with Jerome Powell, his nominee to become chairman of the U.S. Federal Reserve at the White House in Washington, U.S., November 2, 2017. REUTERS/Carlos Barria
U.S. President Donald Trump announces Jerome Powell as his nominee to become chairman of the U.S. Federal Reserve in the Rose Garden of the White House in Washington, U.S., November 2, 2017. REUTERS/Carlos Barria
U.S. President Donald Trump arrives in the Rose Garden to announce Jerome Powell as his nominee to become chairman of the U.S. Federal Reserve at the White House in Washington, U.S., November 2, 2017. REUTERS/Carlos Barria
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Last week, the index fell nearly 1 percent, its third straight week of declines and worst weekly showing in more than two months.

"It seems that markets are not particularly positive on the dollar unless we see some progress on tax reform this week or higher inflation numbers," said FX strategist Vassili Serebriakov of Credit Agricole in New York.

"I think the story from the past week or even couple of weeks now with the flattening U.S. yield curve is still playing a role," he added.

Concern about stubbornly low inflation has boosted longer-dated debt and sent the U.S. Treasury yield curve to its flattest levels in a decade.

U.S. President Donald Trump will meet with Senate Republicans on Tuesday to discuss their party's efforts to pass tax legislation.

Worries about potential delays in the implementation of tax cuts and the possibility of proposals being weakened have weighed on the dollar in recent weeks.

"While progress is being made on tax reforms, traders may well be doubting how quickly they will be enacted and how significant the final draft will be for the economy and therefore interest rates," Oanda markets analyst Craig Erlam said in a note.

The dollar was 0.35 percent lower against the yen.

Traders were also focusing on the upcoming change of guard at the Fed as Powell appears before the Senate Banking Committee on Tuesday. Outgoing Chair Janet Yellen appears before the Joint Economic Committee on Wednesday.

The U.S. dollar gained 0.06 percent against its Canadian counterpart as oil prices pulled back from a two-year high.

Sterling was up 0.11 percent at $1.335 after hitting an eight-week high of $1.3382 as some investors covered their short positions against the British currency.

South Africa's rand bounced against the dollar after the country avoided a double downgrade of its local-currency debt.

(Reporting by Saqib Iqbal Ahmed; Editing by Lisa Von Ahn)

 

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HANG SENG 28,848.11 -318.27 -1.09%
DAX 13,049.14 -18.94 -0.14%
USD (per EUR) 1.18 0.00 0.17%
USD (per CHF) 0.99 0.00 0.05%
JPY (per USD) 112.18 -0.22 -0.19%
GBP (per USD) 1.34 -0.01 -0.47%

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