A resolution to the US fiscal cliff crisis, messy and protracted as it was, provided an immediate boost for financial markets but longer term could spell trouble for some Asian assets coming off a stellar 2012. Investors could start to shift some money out of overpriced or crowded Asian investments in favour of the US on the view that the fiscal deal manages to avert a US recession and boosts prospects for US stocks. A fall in US equities as funds pulled out some money in the fourth quarter, in contrast to a rally in Asia as funds funnelled money into the region, suggest conditions are ripe for some reversal.

“In the short term, US risk premium will come down now that a deal has been struck and might trigger some reversal of flows from Asia back to the US”, said Hong Hao, chief equity strategist at Bank of Communication International Securities.

Analysts do not expect a major reversal of funds, but more of a subtle shift as some money managers rebalance portfolios by taking profits on Asian positions and moving funds into prospective bets in the US.

The S&P 500 fell 1% from September through December last year in the build up to the presidential election and the so-called fiscal cliff. Markets had worried that in the absence of Congressional action, $600 billion (£370 billion) in scheduled tax increases and spending plans would tip the world’s biggest economy into a recession.

At the same time, Asian markets rallied. Japan’s Nikkei rose 17.2% and the MSCI Asia Pacific ex-Japan index rose 5.6%.

But, to be sure, the fiscal deal has done nothing to resolve other political showdowns that loom in coming months such as raising the government debt ceiling and more spending cuts.