The Japanese yen slumped on Friday against all of its 16 major rivals as speculation mounted that political leaders in the U.S. will be able to solve the debt ceiling debacle, Bloomberg reports.
President Barack Obama and his Republican peers in Congress agreed to continue negotiating methods of raising the debt ceiling and fulfilling financial obligations. The currency of the Pacific Rim nation slipped as a haven asset.
"We expect additional monetary policy easing and some further structural reforms around the beginning of the next fiscal year," states a Friday note authored by analysts and chief currency strategist Thomas Stolper, according to Bloomberg. "This suggests that dollar-yen could start to drift higher in the first quarter next year. This would also correspond to the expected start of Fed tapering."
The yen dropped roughly 0.2 percent against the world's reserve currency, which piled on to losses of 1.5 percent during the past three days. The currency of Japan dropped about 0.6 percent against the common currency of the European Union.
Economics Minister Akira Amari of Japan encouraged U.S. political leaders to solve the budgetary impasse, according to Reuters.
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