* Suga set to succeed Abe as Japan PM, focus turns to new cabinet
* Dollar falls to two-week low vs yen
* Dollar under pressure ahead of Fed policy meeting outcome on Wed
* Fed expected to reinforce near-zero rates until 2023
* Graphic: World FX rates in 2020 https://tmsnrt.rs/2RBWI5E (Adds new comment, updates prices)
By Gertrude Chavez-Dreyfuss
NEW YORK, Sept 14 (Reuters) - The dollar slipped on Monday against its major peers, dropping to a two-week low versus the yen, as positive news about a COVID-19 vaccine and a wave of merger and acquisition deals lifted the mood in global equity markets.
Investors also looked ahead to an event-packed week which includes a Federal Reserve meeting and the appointment of a new Japanese premier.
U.S. stocks rose on Monday on signs of progress in developing a COVID-19 vaccine and a flurry of multibillion-dollar deals, including reports of Oracle (NYSE:ORCL) ORCL.N winning the battle for the U.S. arm of TikTok. .N
Drugmaker AstraZeneca AZN.L on Monday said it resumed its British clinical trials of its COVID-19 vaccine, one of the most advanced in development, helping kick off a rally in stocks. some positive traction on the coronavirus vaccine and that has helped lift the market," said Amo Sahota, executive director at currency advisory firm Klarity FX in San Francisco.
"Generally I would call it a soft, upbeat day. I don't know if we have learned anything significantly new today that would give us any indication about trend building. Today it's a day that's more supportive of equities, and so the dollar weakens off," he added.
In afternoon trading, the dollar index fell 0.3% to 93.029 =USD , after posting two straight weeks of gains.
Speculators trimmed net short dollar positions for the second straight week to $32.67 billion, according to Reuters calculations and Commodity Futures Trading Commission data. That's off nine-year highs of $33.68 billion in late August. week's Fed Reserve meeting will be its first since Chairman Jerome Powell unveiled a policy shift toward greater tolerance of inflation, effectively pledging to keep interest rates low for longer.
"The updated 'dot-plot' is expected to reinforce the message that the current zero-interest-rate policy stance is appropriate through 2023," said NatWest in its latest research note, a scenario that is negative for the dollar.
Fed officials' median projection on the number of rate moves is commonly referred to as its "dot-plot."
The dollar fell 0.4% against the yen to 105.70 yen JPY=EBS , after earlier sliding to a two-week low.
The Bank of Japan's meeting on Thursday is not expected to yield any policy changes but the bank may be quizzed on whether it could follow the Fed's inflation stance.
On the political front, Chief Cabinet Secretary Yoshihide Suga was picked to head Japan's ruling party on Monday, meaning on Wednesday in parliament he is set to be selected by his peers as prime minister, taking over from Shinzo Abe.
Suga has vowed to continue Abe's policies. euro was up 0.2% versus the dollar at $1.1867 EUR=EBS .
The single currency had spiked to a one-week high above $1.191 after Thursday's European Central Bank meeting, before easing back as policymakers talked it down the next day.
Currency bid prices at 3:36 PM (1936 GMT) Description
RIC
Last
U.S. Close Pct Change
YTD Pct
High Bid
Low Bid
Previous
Change
Session
Euro/Dollar
EUR=
$1.1866
$1.1845
+0.18%
+5.85%
+1.1887
+1.1831 Dollar/Yen
JPY=
105.6900
106.1400
-0.42%
-2.91%
+106.1900 +105.5600 Euro/Yen
EURJPY=
125.42
125.75
-0.26%
+2.85%
+125.9000 +125.2900 Dollar/Swiss
CHF=
0.9080
0.9086
-0.07%
-6.18%
+0.9098
+0.9060 Sterling/Dollar GBP=
1.2862
1.2793
+0.54%
-2.99%
+1.2918
+1.2778 Dollar/Canadian CAD=
1.3175
1.3174
+0.01%
+1.46%
+1.3196
+1.3154 Australian/Doll AUD=
0.7294
0.7283
+0.15%
+3.89%
+0.7303
+0.7265 ar
Euro/Swiss
EURCHF=
1.0775
1.0764
+0.10%
-0.71%
+1.0776
+1.0758 Euro/Sterling
EURGBP=
0.9224
0.9254
-0.32%
+9.11%
+0.9263
+0.9202 NZ
NZD=
0.6705
0.6664
+0.62%
-0.46%
+0.6717
+0.6660 Dollar/Dollar
Dollar/Norway
9.0281
9.0336
-0.06%
+2.84%
+9.0531
+8.9861 Euro/Norway
EURNOK=
10.7140
10.7024
+0.11%
+8.91%
+10.7269
+10.6716 Dollar/Sweden
SEK=
8.7631
8.7687
+0.08%
-6.25%
+8.7881
+8.7539 Euro/Sweden
EURSEK=
10.4001
10.3916
+0.08%
-0.66%
+10.4220
+10.3756
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https://tmsnrt.rs/2Q64Zj7
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