Forex Flash: US debt ceilling and the polarized political system - Commerzbank
FXstreet.com (Barcelona) - Today's US initial jobless claims is too volatile and the Philly-Fed index potentially dominated by regional effects to allow any conclusions on the future economic development in the US, according to Commerzbank analysts, then focused on politics, not expecting a quick solution to the debt ceilling proble due to the mechanics of the political system.
"The constant struggles in the field of fiscal policy (and in other policy fields as well) feed doubts about whether the political system in the US can function properly", wrote analyst Ulrich Leuchtmann. "The "polarization" theory provides a theoretical framework: as the US is split so clearly into Democratic and Republican regions there is no incentive for the politicians to obtain votes from the centre ground. All that matters is to be nominated again"; he said, adding that Congressmen do not need to compromise with their political opponents but have to represent radical positions to get renominated.
To take pressure off the greenback, only expect notable determination of the politicians to act for the general good.
"The constant struggles in the field of fiscal policy (and in other policy fields as well) feed doubts about whether the political system in the US can function properly", wrote analyst Ulrich Leuchtmann. "The "polarization" theory provides a theoretical framework: as the US is split so clearly into Democratic and Republican regions there is no incentive for the politicians to obtain votes from the centre ground. All that matters is to be nominated again"; he said, adding that Congressmen do not need to compromise with their political opponents but have to represent radical positions to get renominated.
To take pressure off the greenback, only expect notable determination of the politicians to act for the general good.
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