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FXstreet.com (Barcelona) - The authorities (politicians and central bankers) have generally done a good to excellent job in keep the financial system as we know it afloat. However, according to Macro Strategy Analysts J. Reid and C. Tan at Deutsche Bank, "it remains far from being able to stand on its own two feet and regular interventions will continue to be necessary for many years."

So we need politicians and central bankers to be on top form again in 2013 and beyond. Next stop will be February with the budget ceiling discussions and the Italian elections. "This is still a little too far ahead for markets, but will probably be the main source of any volatility in Q1. If negative headlines are limited the current liquidity and normal seasonal demand will highly likely be the dominant and positive force." they suggest.

Indeed after the fiscal cliff outcome, markets will likely take the view that a solution to the budget ceiling talks will eventually materialize and therefore any stresses beforehand will likely be minor as few will want to go short. However this understandable complacency must be watched as neither side wants to back down again. "At some point one of these many political/economic issues facing the developed world won't end up in such a market friendly outcome. The problem is that they're all quite unpredictable in advance and are low probability/high risk outcomes." the strategists warn.

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