By Sam Forgione
NEW YORK (Reuters) - The U.S. dollar surrendered gains to trade little changed against a basket of major currencies on Monday on renewed concerns about how an FBI probe into Hillary Clinton's use of a private email server might the impact on the U.S. presidential election.
Sterling rose on clarity over the Bank of England's leadership.
Analysts said concerns over the prospect of a potential victory for Republican candidate Donald Trump in the Nov. 8 U.S. presidential election led the dollar to give up much of its initial gains against the euro, yen and Swiss franc.
News of the FBI's probe hurt the dollar on Friday because Clinton is viewed as the candidate of the status quo, while there is greater uncertainty over what a victory for Trump might mean for U.S. foreign policy, international trade deals and the domestic economy.
"People want to take a look at the political polls to make sure that the consensus view that Hillary wins is still valid," said Steven Englander, global head of G10 FX strategy at Citigroup in New York.
Analysts said a potential Trump victory could also throw the Federal Reserve off its presumed course of hiking interest rates in December. Traders last saw a roughly 78 percent chance of a December hike, according to CME Group's FedWatch program.
"If there’s market upheaval or uncertainty because the Democratic ticket has to change, then that could have the Fed on hold," said Douglas Borthwick, managing director at Chapdelaine Foreign Exchange in New York.
The dollar index <.DXY>, which measures the greenback against a basket of six major currencies, was last mostly flat at 98.373 after gaining as much as 0.4 percent earlier.
The index was set to gain about 3 percent for the month, putting it on track for its best performance in just under a year. The euro <EUR=>, which was last roughly flat against the dollar, at $1.0978, was set to lose about 2.3 percent in October to post its worst month in five.
The dollar was up 0.14 percent against the yen <JPY=> at 104.84 yen, and set to gain 3.5 percent against the Japanese currency in October to mark its best month in five. The dollar has gained this month on expectations of a December Fed rate hike.
Sterling was up 0.4 percent <GBP=D4> against the greenback at $1.2238 after Bank of England Governor Mark Carney said he would stay in his job for an extra year, until the end of June 2019.
(Reporting by Sam Forgione; Editing by Dan Grebler and Leslie Adler)