Asian session: The yen sank to a 28-month low

01:30Japan Labor Cash Earnings, YoYNovember +0.2%-0.4%-1.1%

The yen sank to a 28-month low as data showing a decline in Japanese consumer prices fanned speculation the central bank will heed government calls to step up cash infusions to end deflation. Finance Minister Taro Aso said today that he agreed with BOJ Governor Masaaki Shirakawa to strengthen cooperation between the government and the central bank. BOJ policy makers next meet Jan. 21-22.

JPMorgan Chase & Co. and Nomura Holdings Inc. cut forecasts for the Japanese currency citing stimulus plans from newly installed Prime Minister Shinzo Abe’s plan. JPMorgan revised its yen projections today, saying the currency will fall to 90 against the dollar in the second quarter next year as Japan’s trade surplus worsens and overseas investors factor in changes under Abe’s administration. Its previous estimate was 83.

U.S. President Barack Obama plans to meet Democratic and Republican congressional leaders today as a year-end budget deadline approaches. U.S. House Republican leaders announced that the chamber will meet on Dec. 30 -- the first Sunday session in more than two years. Lawmakers are seeking to resolve their impasse over spending cuts and tax increases worth more than $600 billion, known as the fiscal cliff, that take effect next month.

EUR / USD: during the Asian session, the pair traded in the range of $ 1.3225-55.

GBP / USD: during the Asian session, the pair rose to $ 1.6125.

USD / JPY: during the Asian session, the pair rose to Y86.65.

US data starts at 1300GMT with the November Building Permits Revision. At 1445GMT, the MNI Chicago Report's business barometer is forecast to rise slightly to 51.0 in December after rising above 50 in November. US data continues at 1500GMT with NAR Pending Home Sales, followed  at 1530GMT by the weekly EIA Natural Gas Storage and at 1600GMT by the weekly EIA Crude Oil Stocks data.