NEW YORK, Nov 22 (Reuters) - The dollar set a 16-month high against the euro on Monday after Federal Reserve Chair Jerome Powell was nominated for a second four-year term by President Joe Biden, while the single currency was hurt by COVID-19 related lockdowns. Lael Brainard, the Federal Reserve board member who was the other top candidate for the job, will be vice chair, the White House said. read more "With Powell being renominated for a second term, that suggests a less dovish outlook for monetary policy than under a potential Brainard leadership," said Joe Manimbo, senior market analysts at Western Union Business Solutions in Washington. "It looks like there"s greater scope for U.S. rate hikes under Powell with Powell remaining on as the Fed Chair, and that has been broadly positive for the dollar," Manimbo added. The dollar index against a basket of currencies rose 0.42% on the day to 96.53, the highest since July 2020. The euro dipped 0.58% to $1.1233, also the weakest since July 2020. The single currency was also dragged lower as concerns grew over new COVID-19 restrictions in Europe, with Austria entering another full lockdown and Germany considering following suit. read more "It"s kind of been a one-two punch for the euro. One has been a rise in cases across the bloc, and what that is doing is reinforcing the decidedly dovish outlook for (European Central Bank) policy and that stands in stark contrast to the Fed, where pressure is building for the U.S. central bank to adopt a quicker pace of normalization," Manimbo said. Powell and Brainard on Monday noted the corrosive impact that high inflation is having on the U.S. economy and American families in what may be a signal that controlling the rapid pace of price increases is now the central bank"s top priority. read more The Fed will release minutes from its Nov. 2-3 meeting on Wednesday, which will be evaluated for any new indications that it may speed up the taper of its bond purchases and hike rates sooner than expected. Fed officials Richard Clarida and Christopher Waller on Friday suggested a faster pace of stimulus tapering may be appropriate amid a quickening recovery and heated inflation. read more The dollar also gained 0.79% against the safe haven Japanese yen to 114.93, approaching the 4-1/2 year high of 114.97 reached on Nov. 17. The greenback also gained 0.55% to hit a seven-week high of C$1.27 against the Canadian dollar . "Given the possibility that more virus lockdowns are announced in the coming days and weeks, risk-sensitive currencies like the CAD may trade on the defensive while declining oil prices exert an additional drag," analysts at Scotiabank said in a report on Friday. Currency bid prices at 3:01PM (2001 GMT) Description RIC Last U.S. Close Previous Session Pct Change YTD Pct Change High Bid Low Bid Dollar index 96.5280 96.1380 +0.42% 7.276% +96.5510 +96.0350 Euro/Dollar $1.1233 $1.1300 -0.58% -8.05% +$1.1296 +$1.1231 Dollar/Yen 114.9300 114.0200 +0.79% +11.26% +114.9500 +114.0550 Euro/Yen 129.10 128.63 +0.37% +1.72% +129.3200 +128.5700 Dollar/Swiss 0.9331 0.9288 +0.47% +5.48% +0.9333 +0.9268 Sterling/Dollar $1.3386 $1.3443 -0.43% -2.02% +$1.3449 +$1.3385 Dollar/Canadian 1.2700 1.2632 +0.55% -0.26% +1.2701 +1.2630 Aussie/Dollar $0.7226 $0.7237 -0.17% -6.08% +$0.7273 +$0.7225 Euro/Swiss 1.0482 1.0474 +0.08% -3.01% +1.0485 +1.0449 Euro/Sterling 0.8391 0.8393 -0.02% -6.11% +0.8403 +0.8381 NZ Dollar/Dollar $0.6953 $0.7000 -0.66% -3.17% +$0.7013 +$0.6954 Dollar/Norway 8.9285 8.9020 +0.26% +3.94% +8.9630 +8.8970 Euro/Norway 10.0315 10.0588 -0.27% -4.16% +10.0932 +10.0082 Dollar/Sweden 8.9895 8.9523 +0.05% +9.66% +9.0137 +8.9349 Euro/Sweden 10.0985 10.0935 +0.05% +0.22% +10.1392 +10.0865 Reporting by Karen Brettell; Editing by William Maclean and Will Dunham