The dollar on track for a third weekly backslide versus the yen as the U.S. government shutdown delayed a key jobs report, clouding the outlook for when the Federal Reserve will taper stimulus. The greenback exchanged in an almost an eight-month low against the euro after Atlanta Fed President Dennis Lockhart stated that the shortage of data “would tend to make me somewhat more cautious” about trimming down the pace of bond purchases. The yen marched up before the conclusion of a Bank of Japan assembly today that is assumed to result in no expansion of financial policy. ‘Catastrophic’ Potential Democrats, including Obama, say Republicans must end the shutdown and raise the debt ceiling as a precondition to talks on broader budgetary disputes. Republicans want to use the fiscal deadlines to extract changes to Obama’s health-care law and other policy concessions. Failure to raise the debt limit has “the potential to be catastrophic,” the Treasury Department warned in a report yesterday that said credit markets could freeze and the value of the dollar could plummet. BlackRock Inc. (BLK)’s Larry Fink and Pacific Investment Management Co.’s Bill Gross said the U.S. debt standoff will be resolved without a default. The congressional dispute will be worked out “very rapidly,” Fink said at a Beverly Hills, California, event. Gross said a default is “not a realistic proposition.” In Japan, the central bank will leave policy unchanged at the conclusion of a two-day meeting today, according to all 35 economists surveyed by Bloomberg News. BOJ Governor Haruhiko Kuroda will hold a news conference following the decision. Kuroda in April unveiled a plan to purchase more than 7 trillion yen ($72 billion) of bonds a month to achieve 2 percent inflation in two years, helping drive the yen down more than 10 percent this year.
