US dollar gains against peers
Jobless claims fall to lowest in a month
Fed expected to cut rates by 35 bps next year

NEW YORK, Dec 26 Reuters The U.S. dollar edged higher on Thursday on expectations the currency would be boosted next year by policies by the incoming Donald Trump administration that are expected to boost growth and lift inflation.

Trading volumes were light on Thursday with many traders on holiday after Wednesdays Christmas holiday and before next weeks New Year holiday.

Looser business regulations and tax cuts are expected to help propel U.S. growth next year while analysts say that a clampdown on illegal immigration and the prospect of new tariffs on trading partners could increase price pressures, and weigh on the economy longer term.

That has boosted the dollar against its peers, though there remains a lot of uncertainty over exactly what policies will be introduced and what their impact will be.

Rising doubts over how many interest rate cuts the Federal Reserve will be able to undertake next year has added to the dollar rally in the past few weeks.

The U.S. central bank last week cut rates by 25 basis points as expected and Fed Chair Jerome Powell said more reductions in borrowing costs now hinge on further progress in lowering stubbornly high inflation.

Fed policymakers raised their inflation projections for 2025 and cut their interest rate forecast to 50 basis points for the year, from 100 basis points.

Money market traders are currently…