Although the currency market is now focused on developments in Europe -- Brexit bluster in the U.K. and protests in France among them -- that could change if Congress doesn’t fund the government just days after the Federal Reserve is expected to raise rates again.
“Rising political risk in the U.S., coming around the time that the Fed meets to decide on its rates policy on 19 December, could undermine the USD and U.S. asset markets,” Gibbs wrote in a note Wednesday. “The EUR may be pressing supports today on political uncertainty in Europe, but it could quite conceivably be busting resistance in the days or weeks ahead as focus shifts to U.S. rates and politics.”
This article provided by Bloomberg News.