* Greenback hits two-week peak vs yen after Trump-Abe
* Investors await Yellen's testimony before Congress
(Updates market action, changes dateline, previous LONDON)
By Richard Leong
NEW YORK, Feb 13 The dollar rose to a near
three-week high against a basket of currencies on Monday, lifted
by hopes of U.S. tax cuts to stoke corporate profits and
investments as well as bets on whether the Federal Reserve might
raise interest rates more quickly.
The greenback last week booked its strongest gain since
mid-December after U.S. President Donald Trump on Thursday
promised a "phenomenal" tax plan that the White House said would
include tax cuts for businesses and individuals.
Investors hope that signals that the focus of day-to-day
remarks by Trump and his aides is shifting away from trade
protectionism and security, and toward economic growth.
"People seemed to be more comfortable with the fiscal policy
outlook. It's been friendly for stocks and also for the dollar,"
said Thierry Albert Wizman, global interest rates and currencies
strategist at Macquarie Group Ltd in New York.
The dollar index, which measures the greenback against six
other currencies, reached 101.07, its strongest level since Jan.
20. It was last up 0.2 percent at 101.04.
The dollar advanced to a two-week peak against the yen
following reports that Trump did not even discuss the currency
or its strength during weekend talks with visiting Japanese
Prime Minister Shinzo Abe. It was last up 0.7 percent at 113.94
The outcome of their meeting was an affirmation for Japan in
the face of challenges such as China's maritime expansion and
North Korea's nuclear weapons and missile development.
Investors are also focused on testimony by Fed Chair Janet
Yellen before Congress on Tuesday and Wednesday in the wake of
hints from other policy-makers who are leaning toward more hikes
in interest rates this year than the two currently priced in by
markets prompted by signs of looser fiscal policies.
"Markets are pricing only a 22 percent probability of a
March Fed move, the question is whether she wants to nudge it
closer to 50 percent," said Nick Parsons, head of currency
strategy at National Australia Bank in London.
The Federal Open Market Committee, the U.S. central bank's
policy-setting group, will meet on March 14-15.
Currency bid prices at 10:30AM (1530 GMT)
Description Last U.S. Close Pct Change
Euro/Dollar $1.0597 $1.0638 -0.39%
Dollar/Yen 113.9800 113.1900 +0.70%
Euro/Yen 120.79 120.40 +0.32%
Dollar/Swiss 1.0061 1.0020 +0.41%
Sterling/Dollar 1.2491 1.2489 +0.02%
Dollar/Canadian 1.3089 1.3078 +0.08%
Australian/Doll 0.7638 0.7669 -0.40%
Euro/Swiss 1.0663 1.0667 -0.04%
Euro/Sterling 0.8482 0.8507 -0.29%
NZ 0.7160 0.7194 -0.47%
Dollar/Norway 8.3916 8.3573 +0.41%
Euro/Norway 8.8938 8.9205 -0.30%
Dollar/Sweden 8.9337 8.9195 -0.27%
Euro/Sweden 9.4678 9.4937 -0.27%
(Additional reporting by Shinichi Saoshiro in TOKYO and Patrick
Graham, Marc Jones in LONDON; Editing by Richard Lough and Will