The pair closed in NY Thursday at Y97.88 after recovering from a session low of Y97.74. Strong general dollar sales were seen through Thursday’s session, catching markets wrong footed on expectation that the US debt ceiling deal would be dollar positive. However, suggestions that the US government closure during the impasse could have delayed QE tapering, along with investor confidence into the US, prompted the strong dollar sell off. Rate nudged back above Y98.00 in early Asia, touching Y98.08 before easing back to Y97.94. This dip attracted another round of demand which lifted rate to the overnight high of Y98.16 before it settled back around Y98.00 through the Asian afternoon and ahead of the European open. China data released overnight didn’t provide any directional impulse, coming in at expected levels. Some exporter sell interest has been suggested to have been lowered to the mid Y98 area, though the stronger interest remains into Y99.00. Support noted at Y97.80/70, more at 97.35 withtraders highlighting the 200-dma at Y97.14. A light US calendar with focus on the rescheduled US NFP to Tuesday Oct22. Some Asian traders have noted that Sunday’s 20th data should provide Gotobi day demand into Monday.
