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The dollar fell to a four-week low on Monday after former U.S. Treasury Secretary Lawrence Summers withdrew his name as a candidate to lead the Federal Reserve.
Summers is perceived by investors as relatively hawkish, and his withdrawal suggests there will be a more gradual approach to tightening monetary policy, which is a negative for the dollar. His decision to withdraw could leave Janet Yellen, the Fed's vice chair, as the front-runner for the top job.
Yellen is largely expected to continue with the generally accommodative stance of the current Fed chair, Ben Bernanke, if named to take his place.
In late afternoon trading, the dollar index, which measures the greenback against six major currencies, fell 0.2 percent to 81.273. It earlier fell to 80.968, its lowest since Aug. 21.
Against the yen, the dollar was down 0.3 percent at 99.05 yen, not far off the day's low of 98.48 yen, which was the lowest since Sept. 6, using Reuters data.
The euro was up 0.3 percent at $1.3337, after hitting a roughly three-week high around $1.3385. Strategists said the pair could now target the Aug. 20 high of $1.3416.
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