The USD was mixed in opposition to its rivals in the light trading before the commencement of the Christmas holiday.
The market was closed for the Christmas on Tuesday and will reopen today.
The USD went up to 84.86 JPY from 84.23 JPY. It slipped to 0.9154 Swiss francs from 0.9168 Swiss francs and to 99.24 Canadian cents from 99.41 Canadian cents
EUR closes unaffected
All the gains that the euro had gained earlier was reversed during the American session on Monday and closed practically unaffected as traders remain obsessed on unsettled US budget discussions. The US President had earlier expressed hopes that an agreement would be reached before Christmas, but nothing has been decided yet.
In the European session on Monday, the EUR/USD peaked at 1.3234 but went down under pressure during its New York trading session and reversed all its earlier gains. This pair closed the Monday abridged session at 1.3176, just 4 pips below its opening price.
The markets remained closed for Christmas on Tuesday. Trading will be resumed in the USA on Wednesday and in Europe on Thursday.
Mr. Shinzo Abe advocates easing of monetary policy by the BOJ
On Tuesday, the incoming Japanese Prime Minister Mr. Shinzo Abe again put in his demands to the Bank of Japan to radically ease its monetary guiding principles by fixing the inflation target of 2% and stated that he wants to tame the strong yen to assist in the revival of the country’s economy.
Mr. Abe who has always been considered to be a hardliner will be sworn in as the Prime Minister on Wednesday. He is also expected to appoint his ministers on the same day. He has prescribed a mixture of forceful easing of the country’s monetary policy and large fiscal expenditure to thump deflation and rein in the powerful yen. He has stated that the economy, diplomacy, education and especially reconstruction and building up the northeastern region of the country which was hit by the tsunami earlier in 2011, earthquake and nuclear disaster, as the situation in the region is very critical and therefore he wants to appoint his council of ministers who can prevail over the catastrophe. However, he has reiterated that it will be up to the BOJ to make a decision on the exact measures to be taken.
Crude Oil slumps as the dreaded’ Fiscal Cliff’ draws near
On Monday, Brent crude futures declined in the shortened session before the Christmas holiday, with lean trading volume being the major feature as crude prices felt force as the budget discussions in USA remained deadlocked. US crude went down by 5 cents or 0.06 % and settled at $88.61 a barrel, after it traded between $88.20 and $88.86.
With regards to Brent crude, it settled 17 cents lesser at $108.80 a barrel, taking its gains since the start of the year to less than $1. As there were no discussions on Monday to ward off the year-end budget deadline that will activate harsh spending cuts and tax hikes, crude oil tracked equity markets to some extent at a lower level, with action in a profound seasonal stillness. The markets were closed on Tuesday on account of Christmas Day.