Daily Report: Muted Reaction to Obama's Job Proposal, Euro Continues Post ECB Weakness
US President Obama unveiled his proposal to stimulate the US job markets overnight, but the financial markets had little reaction. Obama's USD 447b job proposal mainly targets tax cut and investments. While more details will be released on September 19, the measures include a tax-cut for small businesses if they hire new workers or raise workers; a 4000 tax credit if a company hires anyone who has spent more than 6 months looking for a job and extra tax credits if they hire America's veterans; a 1-year payroll tax cut; extension of unemployment insurance and assistance on refinancing homeowners' mortgages. Obama called for an end to the 'political circus' which he believed is the main reason for S&P's downgrade.
EUR/JPY Daily Outlook
Daily Pivots: (S1) 107.07; (P) 108.05; (R1) 108.55; More
EUR/JPY's break of 107.82 suggests recent decline from 123.31 has resumed. intraday bias is back on the downside and further fall should now be seen to 105.42/106.28 support zone next. On the upside, above 109.08 minor resistance will turn bias neutral again and bring consolidations. But after all, we'll stay bearish as long as 111.93 resistance holds and expect more downside ahead.
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