18.12.201702:36:00UTC+00Dollar Holds Firm after U.S. Tax Bill Moves Closer to Ratification

The dollar held modest gains on Monday, having received support after U.S. tax reform efforts moved a step closer to ratification over the weekend.

The greenback inched higher after Republicans on the House-Senate negotiating committee put the finishing touches on a sweeping tax overhaul that involves large corporate tax reductions.

The dollar's gains were limited as investors adopted a wait-and-see approach until the deal was final.

Against the Japanese currency, the dollar was relatively flat at 112.645 yen following Friday's gain of 0.2 percent.

The dollar index versus a basket of six major currencies was little changed at 93.890 after gaining 0.5 percent on Friday.

The dollar also failed to get support from subdued U.S. Treasury yields. The long-term Treasury yield has been confined to a narrow 2.34-2.42 percent range over the past week.

The euro was flat at $1.1758 after dropping 0.2 percent on Friday.

On Friday, Germany's Social Democrats agreed to open exploratory talks on forming a government with Chancellor Angela Merkel, providing a chance to end a period of political deadlock in the country.

The euro did not draw much support though as negotiations between the German parties are not expected to start in earnest until January.

The pound remained on the defensive after dropping almost one percent versus the dollar on Friday, on profit taking after news Brexit talks would move to the second round in January.

Sterling was largely flat at $1.3337.