Dollar on track for monthly loss, Brexit deal hopes lift sterling

TOKYO: The dollar was higher in Asian trading on Thursday after upbeat US economic growth data, but was on track for a monthly loss against a basket of currencies as investors warily watched progress of the US tax reform legislation.

The dollar index, which gauges the greenback against a basket of six major rivals, was up 0.1 percent at 93.255 but was down 1.4 percent for November.

Data on Wednesday showed the US economy grew faster than initially thought in the third quarter, notching its quickest pace in three years, as increases in business investment in inventories and equipment offset a moderation in consumer spending.

"Third-quarter GDP got revised up, and we also had consumer confidence the other day that was really great, a 17-year high," said Jeff Kravetz, regional investment strategist at US Bank Wealth Management.

"Aside from the good economic data, I think most investors are focused on the tax bill," he said. "If it does pass, that should give a lift to the dollar, because tax reform is what investors have been focused on for most of the year."

Congressional Republicans scrambled on Wednesday to reformulate their tax bill to satisfy lawmakers worried about how much it would expand the federal deficit, as the measure moved toward a US Senate floor vote later this week.

In otherwise mostly positive comments about the US economy on Wednesday, outgoing Federal Reserve Chair Janet Yellen told Congressional leaders in her final scheduled testimony on Capitol Hill that the path of the federal debt "should keep people awake at night."

Sterling stood tall in Asian trading on Thursday on hopes that Britain and the European Union will reach a Brexit accord.

The pound was steady on the day at $1.3414 after rising as high as $1.3449 overnight, its highest since Sept. 28 and up 1 percent for the month.

The British 10-year government bond suffered its biggest fall since June on Wednesday after media reports that said the country would be willing to pay around 50 billion euros ($59.25 billion) to unblock stalled Brexit talks.

The euro added 0.1 percent to $1.1854, poised to gain 1.8 percent for the month.

The dollar firmed 0.1 percent against the yen to 112.00 , but was down 1.5 percent for the month, as investors continued to monitor tensions on the Korean peninsula after Pyongyang's latest missile launch.

Speaking at an emergency U.N. Security Council meeting, US ambassador Nikki Haley warned the North Korean leadership that it would be "utterly destroyed" if war were to break out.

Bitcoin was up 1.8 percent at $10,014, a day after it stoked fears of a swelling bubble as surged to a record high of $11,395.