Yen, Euro Higher in Asian Trade

The Japanese Yen edged lower off the 1-week peak struck overnight in Asia while the Euro steadied on U.S. policymakers’ comments which renewed investors hopes that the fiscal cliff might be avoided. As reported at 11:10 a.m. (JST) in Tokyo, the USD/JPY pair was trading at 82.15 Japanese Yen, a gain of 0.1% from late trading in New York and a few pips from the Wednesday trough of 81.68 Yen. With the month end approaching, investors are wary of the possibility of large bids which helped to support the greenback; last week the pair touched on a 7½ month high on speculation that the next likely Japanese government will push through aggressive measures to devalue the Japanese currency. Comments from the current front runner who is presumed to take over as prime minister next month pushed the Yen some 4% lower this month alone.

In the U.S., the U.S. Speaker of the House expressed optimism that Republicans and Democrats would be able to strike a deal soon, and President Obama said it was his hope that agreement could be reached before Christmas. If no agreement is reached, tax increases and spending reductions worth nearly $600 billion would be implemented automatically that analysts say could send the U.S. economy into a recession. The EUR/USD pair was earlier trading recently at $1.2942, slightly above yesterday’s low of $1.2880 but off from late trading in New York. More recently, the Euro-Dollar was up 0.5%, trading at $1.2956.