* Bitcoin recovers towards $16,000 after last week's rout
* Speculators pare bearish dollar bets last week - CFTC data
* BOJ minutes show central bank still committed to easy policy
* London, other major financial hubs stay closed after Christmas (Updates market action, graphic)
By Richard Leong
NEW YORK, Dec 26 (Reuters) - The dollar was little changed against major currencies on Tuesday as traders brushed off encouraging Japanese inflation data and Bank of Japan minutes that signaled policy-makers favored sticking to a loose monetary policy.
Bitcoin staged a comeback on bargain-hunting after it recorded a 25 percent decline on the Luxembourg-based Bitstamp exchange last week BTC=BTSP , its biggest weekly drop since April 2013.
Currency trading volume was light as London and many major financial centers remained closed after the Christmas holiday.
"The market is going to be quiet for the balance of the week," said Jason Leinwand, chief executive officer of FirstLine FX Currency Strategy in Randolph, New Jersey.
The greenback is expected to be supported into early 2018 in the aftermath of the biggest overhaul of the U.S. tax code in 30 years which became law last week. consensus among analysts was that a drop in corporate tax rates would spur business investments, bolstering the U.S. economy and the dollar even though the tax plan would add $1.5 trillion to the national debt in 10 years.
"The dollar has some room to strengthen in the first half of 2018," Leinwand said.
Speculators dialed back their net short dollar bets last week ahead of the passage of the tax legislation, according to Commodity Futures Trading Commission data released on Friday. traders said it was too early to tell whether U.S. companies would spend more for equipment and hire more workers under a lower-tax scheme in the coming months.
The dollar held steady at $113.16 yen JPY= and flat versus the euro at $1.1863 EUR=
The euro was barely budged at 134.23 yen EURJPY= .
The market had a muted reaction to data released early on Tuesday which showed that Japan's core consumer prices rose for the 11th straight month, up 0.9 percent year-on-year, and household spending jumped in November. the inflation rate remains distant from the Bank of Japan's 2 percent target, the rise offered some hope that a steady economic recovery will gradually drive up prices.
Minutes of the BOJ's October meeting, released on Tuesday, showed most members shared the view that the central bank should maintain its easy policy. BOJ kept monetary policy steady last week and its governor reassured markets the central bank will lag well behind overseas peers in ending its ultra-easy policies. cryptocurrencies, bitcoin gained 14 percent following last week's selloff. It was last at $15,885.00 BTC=BTSP after trading as high as $16,147.87 on Bitstamp. Bitcoin's Banner 2017 Cools at Year-End
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