Nov 6 (Reuters) - A key gauge of what banks charge each other to borrow dollars for three months rose on Tuesday in advance of the U.S. Federal Reserve’s two-day policy meeting later this week.
The London interbank offered rate to borrow three-month dollars edged up 0.2 basis point to 2.59125 percent, following a 0.3 basis point decline on Monday.
Three-month LIBOR has risen 14 of the last 15 sessions, prompted by the Fed’s rate hikes, rising U.S. government borrowing and a shrinking Federal Reserve balance sheet.
LIBOR is the benchmark rate for $200 trillion of dollar-denominated financial products, mainly interest rate swaps and floating-rate loans.
Fed policymakers are not expected to raise key short-term interest rates at their upcoming meeting on Wednesday and Thursday, but traders waited to see whether they offer clues about possible rate increases in December and in 2019.
Reporting by Richard Leong in New York; Editing by Jeffrey Benkoe
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