Soften yeast in warm water.
Combine next 5 ingredients.
Add 1 cup flour; beat well.
Beat in softened yeast and egg.
Add enough remaining flour to make soft dough.
Turn out on lightly floured surface; knead till smooth, about 5 to 7 minutes.
Place in greased bowl, turning once to grease surface.
Chill dough thoroughly, about 13 1/2 to 2 hours.
Roll out on lightly floured surface to 1/2 inch thick.
Cut with 2 1/2-inch doughnut cutter.
Let rise till light, about 1 1/4 hours.
Fry in deep hot fat (375°) till browned.
Drain thoroughly; dust with confectioners' sugar.