Dollar slips after Lagarde warned of fiscal cliff uncertainty

<p>The dollar has slipped in forex trading after Christine Lagarde warned how fiscal cliff uncertainty could damage the global recovery.</p>

The dollar has slipped in forex trading today (December 10th) versus the euro and pound after chief of the International Monetary Fund (IMF) Christine Lagarde warned that uncertainty surrounding the fiscal cliff could damage the global recovery.

Speaking to BBC News on Friday, the former French finance minister explained it is imperative US decision-makers reach an agreement that will lessen the impact of the basket of tax rises and spending cuts due to hit the world's largest economy in the new year.

But this can only be reached if the Democrats and Republicans broker a budget deal – a task that has thus far proved a challenge.

President Barack Obama wants to see tax rises on wealthy Americans, but the Republicans are opposed to this, urging instead for greater cuts in government expenditure.

At 14:10 GMT, the dollar was marginally lower in trading versus the euro to $1 buying €0.773, while it depreciated by 0.3 per cent against the pound to £0.621.

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