Forex Flash: Fiscal cliff negotiations inch forward – Deutsche Bank

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FXstreet.com (Barcelona) - In looking at the 'fiscal cliff' debate it is interesting to see the growing number of worrying headlines around the state of negotiations. Politico noted that negotiations between the Democrats and the Republicans are off to a "rough start", despite the cordial public statements made by both camps last Friday.

The article suggests that the Republican's opening proposal to "freeze the Bush-era tax rates, change the inflation calculator for entitlement programs, keep the estate tax at 2012 levels and authorize a major overhaul of the tax code" wasn't something the White House could accept. At the same time, reports noted that Democrats are unwilling to make significant concessions to entitlements as demanded by Republicans.

Indeed, in an op-ed piece in the Cincinnati Enquirer, Boehner wrote that "Obamacare has to go" suggesting a fairly hardline stance on entitlements. The slow pace of talks was also confirmed by the WSJ, which described the negotiations as "inching forward" ahead of a likely meeting between Obama and congressional leaders when they return from Thanksgiving holidays next week. According to Macro Strategy Analysts J. Reid and C. Tan at Deutsche Bank, "Fiscal cliff issues will remain a key driver for markets in the near-term as speculation of inaction or setbacks likely builds."



The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.



This article appears in: Investing , Forex and Currencies

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