26 Sep 2013
European open: US fiscal speculation supplants US monetary speculation
FXstreet.com (London) - Heading into the European session, US monetary policy speculation has been supplanted by US fiscal policy speculation.
Low volumes of top-tier data mean that risk sentiment will be a large factor heading into European trading as concerns over US debt ceiling negotiations weigh on markets.
The US is set to reach its USD6.799trillion debt ceiling by mid-October. A government shutdown will be triggered if measures to extend the ceiling are not passed.
Yesterday Republican Senator Ted Cruz completed a marathon protest speech against continued funding of President Obama’s flagship Affordable Care Act. The House had already passed a bill that would extend the debt ceiling until 15 December, while partially defunding the Obamacare programme. Texas Senator Cruz, joined by others including Mike Lee, Marco Rubio and Rand Paul voiced concerns that Democrats would be able to restore funding once the bill had passed.
Though the speech was destined for failure, it reinforced concerns that congress is unlikely to come to a swift and peaceable conclusion to the debt ceiling stand-off.
This mornings M3 numbers are unlikely to be significant, with little room for upturn. However, European Policymakers will want to see some strengthening going forward to avoid recourse to another LTRO-type programme.
EUR/USD made zero net gains over Asian trading, currently at USD1.3524.
UK data today is limited to the third and final reading of second quarter GDP, expected to remain unchanged at +0.7 percent, quarter-on-quarter, as well as the current account balance for the second quarter.
Cable continues to test highs, currently at USD1.6093.
Low volumes of top-tier data mean that risk sentiment will be a large factor heading into European trading as concerns over US debt ceiling negotiations weigh on markets.
The US is set to reach its USD6.799trillion debt ceiling by mid-October. A government shutdown will be triggered if measures to extend the ceiling are not passed.
Yesterday Republican Senator Ted Cruz completed a marathon protest speech against continued funding of President Obama’s flagship Affordable Care Act. The House had already passed a bill that would extend the debt ceiling until 15 December, while partially defunding the Obamacare programme. Texas Senator Cruz, joined by others including Mike Lee, Marco Rubio and Rand Paul voiced concerns that Democrats would be able to restore funding once the bill had passed.
Though the speech was destined for failure, it reinforced concerns that congress is unlikely to come to a swift and peaceable conclusion to the debt ceiling stand-off.
This mornings M3 numbers are unlikely to be significant, with little room for upturn. However, European Policymakers will want to see some strengthening going forward to avoid recourse to another LTRO-type programme.
EUR/USD made zero net gains over Asian trading, currently at USD1.3524.
UK data today is limited to the third and final reading of second quarter GDP, expected to remain unchanged at +0.7 percent, quarter-on-quarter, as well as the current account balance for the second quarter.
Cable continues to test highs, currently at USD1.6093.