ForexLive US Wrap: Risk Rally Extends; EUR/USD Breaks to New Highs

US current account deficit shrinks to $107.5 bln in Q3 versus $118.2 in Q2
RBA's Stevens fears boom/bust for Australia.
House Speaker Boehner offers plan b if work toward larger fiscal cliff deal fails; White House rejects
Belgian consumer confidence falls to -25, a 4-year low
NAHB homebuilder confidence index rises to 47, a 6 year high
Greece upgraded by S&P to B- from selective default after bond buyback
White House: Path to compromise on fiscal cliff is clear (market agrees)
ECB's Praet: French deficit cuts rely too much on taxes, not enough on spending reductions
S&P 500 rises 1.2% to 1447
US 10-year yield rises 5.5 bp to 1.828% after testing highs from September of 1.85%

EUR/USD bulled its way through 1.3200 in NY morning trade as the makings of a fiscal cliff deal became clear. The White House and Boehner are about $400 bln a part on tax hikes and $500 bln apart on spending cuts. A compromise seems likely.

EUR/JPY roared as well, rallying to within pips of a 111.50 barrier after testing highs not seen since February. USD/JPY closes above 84.00 for the first time since March 21 tonight.

Gold continues to trade inversely to the dollar on deflationary fears from Europe and Japan as a heavily long market heads for the exits in thin year-end markets. Gold fell 1.5% and closes at $1672.