* Boehner's comments boost risk appetite
* Dollar/yen also helped by speculation of month-end bids
* Doubts about Greece debt buyback weigh on euro
* Yen still seen under pressure ahead of Dec 16 election
By Hideyuki Sano
TOKYO, Nov 29 The yen slipped from a one-week
high hit overnight on Thursday and the euro regained some
footing after comments from U.S. policy makers rekindled hopes
of a deal to avert a sharp fiscal tightening.
"For the moment, the U.S. fiscal cliff seems to be a
dominant theme for the market," said Katsunori Kitakura,
associate general manager of market-making at Sumitomo Mitsui
U.S. House Speaker John Boehner, the top Republican in
Congress, voiced optimism that Republicans could broker a deal
with the White House to avert a fiscal crisis, even though he
repeated his opposition to raising income tax rates on high
President Barack Obama said on Wednesday he hoped to reach
an agreement with Congress before Christmas.
Investors fear the planned tax increases and spending cuts
due to start at the beginning of next year totalling about $600
billion could tip the world's biggest economy into recession and
depress the global economic outlook.
The dollar rose to around 82.15 yen, up about 0.1
percent from late U.S. levels and off Wednesday's one-week low
of 81.68 yen.
Expectations of big month-end dollar/yen bids also supported
the dollar, which had been in a corrective decline after a surge
to 7 1/2-month high of 82.84 last week on speculation about
aggressive monetary easing in Japan after a likely government
change next month.
Main opposition leader Shinzo Abe, a front-runner to become
prime minister after the Dec. 16 election, has called for
radical change in monetary policy, including unlimited easing,
sparking a four-percent fall in the yen earlier this month.
"The market's reaction to Abe's comments is becoming smaller
and smaller. Still, considering that there could be a fresh wave
of yen-selling after the election, it's hard to see the
dollar/yen falling much below 82 yen," said a trader at a
The euro traded at $1.2942, down slightly from late
U.S. levels but still above Wednesday's low of $1.2880, helped
by improved risk appetite due to revived optimism on the U.S.
More pessimistic comments from a top Democratic lawmaker on
a deal to avert the fiscal cliff on Tuesday had contributed to
the fall in risk assets including the euro earlier on Wednesday.
Market players were also concerned about some elements of
the latest aid deal for Greece, agreed by euro zone finance
ministers and the International Monetary Fund earlier this week,
especially how Greece can successfully implement its debt buy
back plan by the Dec 13. deadline.
Greek Finance Minister Yannis Stournaras has so far declined
to give details.
Still, the euro has one positive technical sign after its
recovery from lows on Wednesday, which produced a bullish hammer
pattern on the candlestick chart.
Investors anxiety from the euro zone's debt crisis has come
down significantly, with the 10-year Italian bond yield falling
to its lowest level since February 2011, supporting the euro.
The currency has a resistance from daily Ichimoku cloud top
around $1.2994 but a break there could boost optimism on the
currency and give it an impetus to rise above its four-week high
of $1.3010 hit just after Greece's international lenders agreed
to unblock aid funds to Greece.
Against the yen, the euro changed hands at 106.22 yen
, so far flat on the day and not far from seven-month
high of 107.135 yen hit on Monday.