House To Be Recalled
The countdown to the US fiscal cliff continues with few obvious signs of progress over the past week. All hope is not yet lost however. House majority leader Cantor announced overnight that the US House of Representatives is due to meet in a previously-unscheduled session. The session will begin on Sun Dec. 30 at 1830 EST (but FX markets in Asia will have already been open for over 5 hours by then). It is not yet clear what sort of action the House will take, but we can reasonably assume that a Republican-sponsored plan to avert the fiscal cliff will be put to a vote. Cantor did not seem especially optimistic about meeting the Dec. 31 cliff deadline however, adding that this special session could continue until Jan. 2. Elsewhere, US President Obama has cut short his holiday and is due to host a White House meeting at 1500EST on Friday with Democratic and Republican leaders. Meanwhile USDJPY continues to grind higher mostly indifferent (so far) to the US political calendar. The pair traded up to a new 28-month high of 86.64 overnight.
Click here to read the full report: UBS Morning Adviser Europe
UBS Investment Bank