DOLLAR EDGES UP AHEAD OF FED; BITCOIN FUTURES SEIZE THE SPOTLIGHT

The dollar was steady in early Asian trade, underpinned by expectations of higher U.S. interest rates, while bitcoin seized the spotlight as futures of the cryptocurrency began trading.

U.S. employment data showed a bigger rise in jobs than expected in November, but the dollar’s gains were capped by disappointing wage data that analysts said could weigh on the pace of interest rate hikes next year.

Bitcoin was up 1.2 percent at $14,819.05 on the Luxembourg-based Bitstamp exchange.

The first bitcoin futures began trading on CBOE Global Markets Inc’s CBOE.O CBOE Futures Exchange. The futures are cash-settled contracts based on the auction price of bitcoin in U.S. dollars on the Gemini Exchange, which is owned and operated by virtual currency entrepreneurs Cameron and Tyler Winklevoss.

The most-traded futures contract opened at $15,460, then leapt to a high of $16,660 and last stood at $15,860.The dollar index, which tracks the greenback against a basket of six major rival currencies, was steady at 93.885 .DXY.

The U.S. Federal Reserve is widely expected to raise interest rates at its two-day policy meeting that will end, and is seen as likely to tighten two or three times in 2018. But still-sluggish inflation has clouded the policy outlook.

“There is a consensus that the Fed will hike, so what investors are most interested in is any clue as to what it will do next year, and the pace of interest rate increases,” said Yutaka Miura, a senior technical analyst at Mizuho Securities in Tokyo.

Against its Japanese counterpart, the dollar edged up 0.1 percent to 113.56 yen, probing levels last touched in mid-November.

 

Britain and the European Union reached an accord that paves the way for talks on future trade ties, easing immediate pressure on Prime Minister Theresa May and raising investors’ hopes for an orderly Brexit.

May will hail “a new sense of optimism” in Brexit talks, telling parliament Britain and the European Union should sign off on a deal at a summit “to move forwards together” to discuss future trade ties.

Source: Reuters

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