Investing.com - The pound dipped on Monday as the U.K.’s conservative party begins voting on who will become the next leader of Parliament.

Either Boris Johnson - who is regarded as the frontrunner - or Jeremy Hunt will be named the successor to Theresa May on Tuesday.

The U.K. foreign minister, Sir Alan Duncan, resigned on Monday in protest of the possibility of Johnson becoming prime minister. Duncan is expected to push for an emergency vote after the new PM is announced.

Sterling fell, with GBP/USD down 0.1% to 1.2494 by 11:03 AM ET (15:03 GMT).

Meanwhile the blackout period for Federal Reserve officials begins, with no more clues as to whether the central bank will cut rates by 50 or 25 basis points at its next meeting on July 30-31.

The U.S. dollar index, which measures the greenback’s strength against a basket of six major currencies, gained 0.1% to 96.880.

The chance of an aggressive Federal Reserve rate cut appear to have eased over the weekend after Boston Federal Reserve President Eric Rosengren, one of the leading hawks on the policy-making Federal Open Markets Committee, said the U.S. economy doesn't require stimulus.

“I don’t want to ease if the (U.S.) economy is doing perfectly well without the easing,” he said in an interview with CNBC, which aired after Friday’s market close.

The dollar fell against the Japanese yen, with USD/JPY up 0.1% to 107.84.

Elsewhere, EUR/USD was flat at 1.1221, while USD/CAD gained 0.4% to 1.3111.

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