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FXstreet.com (San Francisco) - Another day of 'Fiscal Cliff' drama and uncertainty is ahead, as developments in the United States have yet to produce a deal between Democrats and Republicans to avert the massive tax hikes and spending cuts due to take effect next week, which could send the world's largest economy into recession.

President Barack Obama will meet with congressional leaders at the White House later today, including Senate Republican leader Mitch McConnell, Senate Democratic leader Harry Reid, House Speaker John Boehner and House Democratic leader Nancy Pelosi.

As Eric Viloria, CMT, Senior Currency Strategist at FOREX.com explains in a research note: "Budget negotiation headlines continue to dictate market sentiment and when headlines suggest a deal is unlikely US treasury yields and equities fall while the USD rises. Alternatively, when markets take an optimistic view, equities tend to rally, yields rise, and the dollar declines."

For now though, EUR/USD exchanges at 1.3242, USD/JPY now stands at multiyear highs at 86.45, and AUD/USD remains flat at 1.0375 so far this Friday. According to Dick Durbin, a Democrat from Illinois, a passage of a fiscal cliff deal will depend "a lot" on the White House meeting.

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