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Forex pairs in this Article » USD/JPY
FXstreet.com (London) - The Yen shed some of its save haven gains overnight as the Asian stock markets climbed on optimism that Congress would blink in its stand-off over the US government debt ceiling before it hits its hard deadline on 17 October.

The Nikkei gained 0.3 percent and the Hang Seng 0.87 percent. Meanwhile, the Yen fell from 8-week highs against the dollar. USD/JPY is up 0.54 percent to 97.1450 on low volatility.

The confidence showed in the Asian market may be fragile, however, and those USD/JPY gains could be at risk once members of Congress wake up and open their mouths later today.

Republican House Speaker, John Boehner has stated that the House will not pass a bill allowing for a temporary extension of the debt ceiling unless there are provisions for a cut in government spending, possibly including a one-year delay to the implementation of the Affordable Care Act. Senate Democrats have killed any bill with such provisions. President Obama said yesterday: “We’re not going to negotiate under the threat of economic catastrophe.”

With US data releases cancelled due to the furloughing of government workers, including statisticians that compile the data, focus will instead be on politicians. And it would be a shock if they did not step in later today to trample any market confidence in a swift resolution to this crisis.
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