WASHINGTON (MNI) – The following is a roundup of key developments
and events Tuesday as Congress draws closer to passing legislation
raising the U.S. debt ceiling:

* Asian bourses shadowed overnight movements on Wall Street
Tuesday, as optimism over progress on passing the U.S. debt-hike bill
gave way to more deep-rooted fears regarding the prospects for global
growth. The Hang Seng Index ended the day down 1.07% at 22,421.46,
extending losses in late afternoon on weakness in trade and resources
stocks.

* The Bank of Japan believes that even if the U.S. debt ceiling
issue is resolved, the trend of a weakening dollar will likely remain
intact on the back of growing concern over a weaker U.S. economy.

* In its statement Tuesday, the Reserve Bank of Australia said
downside risks to world growth had increased recently as concerns have
grown over the outlook for the public finances of both Europe and the
United States.

* The U.S. dollar gained marginally against the yen in the Asian
morning Tuesday, after the proposal to raise the U.S. debt ceiling
cleared the House hurdle and amid rampant rumors that Japanese
authorities were poised to intervene to curb the yen’s recent rise. “The
deal allows U.S. to avoid a default and ensures the U.S. will not be
facing the same crisis through 2012,” said analysts at United Overseas
Bank. “Even if the deal is agreed, the U.S. woes may still continue as
there is still a high probability of an S&P downgrade.”

* The House voted Monday evening to approve the debt ceiling
package that was crafted by President Obama and congressional leaders
over many long and contentious months. The House vote was 269 to 161.
The bill’s passage through the House has widely been viewed as the
bill’s most serious challenge. The bill now goes to the Senate for a
vote Tuesday. Senate Democratic and Republican leaders have predicted a
strong vote in the Senate Tuesday. Senate Majority Leader Harry Reid
said the Senate will vote at noon Tuesday on the debt-hike bill.

* Despite the last-minute deal that avoided default, the United
States’ sovereign debt problems are still a major threat to the global
economy, the official People’s Daily said in a short commentary
published Tuesday. Nevertheless, given the dollar-denominated global
currency system and economic risks elsewhere in the world, there is no
better investment alternative for China at the moment than U.S.
government debt, the Communist Party’s flagship publication said.

–Editor: Brai Odion-Esene; besene@marketnews.com

** Market News International Washington Bureau: 202-371-2121 **

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