The yen retreated toward recent lows against the dollar and the euro in Asia on Thursday, failing to capitalize on a small bounce as markets positioned for a possible scaling back of the Federal Reserve’s stimulus as early as next week.
News that Congress has reached a bipartisan budget deal that would end three years of impasse and fiscal instability was seen clearing a potential hurdle for the Fed to taper its massive bond-buying program.
Investors’ appetite for risk waned on the growing possibility of an earlier-than-expected stimulus reduction by the Fed at its final policy meeting for 2013 next Tuesday and Wednesday.
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