The dollar index, which measures the greenback against a basket of currencies, fell 0.06% to 101.41, after a 0.36% decline in the prior session. (EPA Images pic)TOKYO: The dollar edged lower on Thursday in the aftermath of an overwhelming victory by Democrats in US midterm elections that cleared a major source of uncertainty and fuelled a rally in global equities.

The yen firmed after minutes of the Bank of Japan's September meeting reinforced expectations for further interest rate hikes, while sterling held near a seven-week high ahead of a Bank of England policy decision expected to deliver another rate increase.

Democrats swept to sizable majorities in the Senate and House of Representatives, easing concerns about contested results and spurring gains in US Treasuries and equities around the world. The election result raises prospects of political gridlock in Washington and lowers expectations that US President Donald Trump will resume military strikes against Iran, said Ray Attrill, head of FX strategy at National Australia Bank.