In comments on Thursday, US Treasury Secretary Mnuchin stated that the Treasury is working day and night and is close to bringing forward major tax reform and that the plan will be unveiled very soon.
He also stated that tax reforms will be passed before the end of 2017.
As far as individual tax reform is concerned, Mnuchin wants three or four individual tax brackets and that any revenue lost from lower tax rates would be made up with extra growth and dynamic scoring of the plans. He also commented that the focus was on boosting economic growth.
Looking at international issues, the focus according to the Treasury Secretary is around fair and balanced trade.
The dollar edged slightly higher on the bullish comments from Mnuchin, especially given the focus on boosting growth. There was also relief that the Treasury appears to concentrating on technical issues rather than focussing on the dollar.
There will still be concerns that the timetable will slip, especially with House Republicans still struggling to move beyond healthcare reform, although Mnuchin insisted that tax reforms will happen whether healthcare reform is done or not.
USD/JPY edged back towards 109.40 and close to daily highs while Treasuries ticked lower as the 10-year yields traded just above 2.25%. Equities maintained a strong tone with the S&P 500 index up close to 0.9%.