The pair started the day on a slightly defensive note as news reports out of the US pointed to a debt limit deal being hammered out. Dollar-yen started the session with mild gains to Y98.35 before it turned lower after US lawmakers said saying there will be no vote tonight on any debt limit plan. The dollar again turned higher after Senate leaders were subsequently quoted saying talks had resumed and that a deal could be reached later today. Dollar-yen’s rebound off a Y98.13 low went through the early highs of Y98.30/35 and then through Y98.40 before it stopped short of the US high of Y98.70, at Y98.64. There were mild pullbacks off the high but these were largely limited toY98.34 as sentiment remained supportive of risk and broader US dollar positions. Euro-yen meanwhile also mirrored dollar-yen’s moves, as it traded an early Y132.76 low at the open and then rebounding after that to Y133.33 highs. The cross stayed supported through much of the morning, holding mostly between Y133.00 and Y133.30. Dollar-yen was last at Y98.57 while the cross was at Y133.20.
