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FXstreet.com (Barcelona) - Brown Brothers Harriman analysts feel that investors knew almost instantly that the Senate bill that the House approved just postponed for two months the important spending cut decisions.

They continue, "Investors also knew that the contentious so-called Bush tax cuts became permanent for the vast majority of Americans. They also knew that the payrolls savings tax holiday was over."

The response by the rating agencies was not surprising. S&P and Moody´s noted that the measures do not put the US fiscal trajectory on a sustainable medium term path. They continue to explain that the S&P said the agreement will not change its rating, while Moody´s was waiting for the outcome of subsequent decisions on spending. Both agencies have had the US on negative credit watch for well over a year now. Meanwhile, the team finish by explaining that early forecasts show economists estimating the fiscal tightening to be between 0.75% and 1.5% of GDP. "The recession that the CBO warned that was likely on a full scale cliff dive appears to have been averted."

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