FOREX-Euro falls, yen gains as Boehner drops "fiscal cliff" plan

Fri Dec 21, 2012 7:50am IST

* Republicans pull tax bill from House floor

* US House to adjourn until after Christmas

* Thin year-end markets exacerbating FX swings -analyst

By Masayuki Kitano

SINGAPORE, Dec 21 (Reuters) - The euro fell against the dollar on Friday as Republican House Speaker John Boehner abandoned his Bill to avoid the "fiscal cliff", conceding there weren't enough votes for it in the chamber.

Boehner handed back responsibility for getting a bill passed to President Barack Obama and his Democrat-dominated Senate, and Republican Representative Peter Roskam said the U.S. House of Representatives would adjourn until after Christmas,

The euro fell 0.3 percent to $1.3208, pulling away from an eight-month high of $1.33085 that had been hit on Wednesday on trading platform EBS.

"The market is jittery and unsure about what might happen," said Satoshi Okagawa, senior global markets analyst for Sumitomo Mitsui Banking Corporation in Singapore.

Some market players, however, were still holding out hope for an eventual compromise, he said, adding that currency swings were being exaggerated in thin year-end market conditions.

The renewed jitters over the fiscal cliff, steep U.S. tax increases and spending cuts due to take effect early next year, dented risky assets and currencies and lifted the safe-haven U.S. dollar.

The yen, which has been pressured by market expectations that a new Japanese government would push the Bank of Japan into more forceful monetary easing, regained a bit of ground as risk appetite fell.

The dollar eased 0.2 percent to 84.23 yen, inching away from a 20-month high of 84.62 yen struck on Wednesday. The euro fell 0.5 percent to 111.20 yen.

The Australian dollar slipped 0.3 percent to $1.0447 .

INTERNAL SECURITY

REUTERS SHOWCASE

Setback For Sahara

Setback For Sahara

Supreme Court defers verdict on Sahara plea to raise more debt on hotels  Full Article 

SpiceJet Crisis

SpiceJet Crisis

SpiceJet says fleet grounded on lack of fuel  Full Article 

Drug Patents

Drug Patents

Novartis sues Cipla over respiratory drug Onbrez   Full Article 

Boost for Tata Steel

Boost for Tata Steel

Tata Steel restarts key iron mines amid shortage  Full Article 

Reuters Poll

Reuters Poll

BSE Sensex to hit 32,980 by December 2015  Full Article 

India Outlook

India Outlook

ADB trims growth forecasts for developing Asia, says India to grow 5.5 pct in 2014  Full Article 

Real Estate

Real Estate

HDFC to raise $500 mln real estate private equity fund - sources  Full Article 

Banking Sector

Banking Sector

Japan banks to bulk up India presence on improving ties   Full Article 

U.S. Spending Bill

U.S. Spending Bill

Obama signs bill $1.1 trillion government spending bill  Full Article 

Reuters India Mobile

Reuters India Mobile

Get the latest news on the go. Visit Reuters India on your mobile device  Full Coverage