Early trade in New York: dollar gains for second day on US tax reform hopes

The dollar rose for a second straight session on Tuesday, a day after posting its biggest daily rise in a week, as the currency continued to benefit from optimism surrounding US tax reform. While the Senate and House of Representative have differences on the US tax bill, it looks like it's just a matter of time before the final bill reaches President Donald Trump for final approval, Hussein Sayed, chief market strategist at FXTM in Dubai said.
"This scenario will probably continue to provide the greenback support for the remainder of 2017, with pullbacks seen as an opportunity for bulls." On Monday, the Republican-controlled House of Representatives voted to go to conference with the Senate on tax legislation, setting up formal negotiations on the bill that could take weeks to complete.
The Republican-led Senate is expected to hold a similar conference vote later this week. In mid-morning trading, the dollar index, a gauge of the greenback's value against six major currencies, was up 0.1 percent at 93.308.
Against the yen, the dollar gained 0.2 percent to 112.70 yen. The euro, meanwhile, was down 0.3 percent versus the dollar at $1.1832 Though the dollar has recovered some poise after falling to a two-month low last week, some market strategists expect further dollar gains next year to be limited, with the euro likely to be the beneficiary.
Meanwhile, sterling trimmed earlier losses to trade 0.3 percent down on the day at $1.3427 as broad disappointment over the lack of a Brexit deal prompted some investors to cut their long bets. It hit an intraday low of $1.3370.