Investing.com - The dollar edged into positive territory against the yen in afternoon trading on Monday as investors priced in a U.S. government shutdown into trading and then looked past fiscal issues, betting that an improving economy later this year will prompt the Federal Reserve to begin winding down stimulus programs.
In U.S. trading on Monday, USD/JPY was trading at 98.30, up 0.06%, up from a session low of 97.51 and off a high of 98.46.
The pair was likely to find support at 96.82, the low from Aug. 27, and resistance at 99.14, Thursday's high.
The U.S. Congress must approve a spending package by the end of the day to avoid a government shutdown, and waning faith for a last-minute deal steered investors away the dollar and into other safe-haven assets such as the yen earlier.
Congressional Republicans and Democrats continued to spar over President Barack Obama's healthcare law, a bargaining chip to fund a spending package to keep the government running.
Republicans oppose the president's healthcare reform and want it delayed in exchange for approving a spending deal, something the Democratically controlled Senate rejected on Monday.
Still, the dollar reversed earlier losses on better-than-expected economic indicators, which boosted expectations for the Federal Reserve to begin tapering stimulus programs once fiscal jitters subside.
The Federal Reserve Bank of Dallas reported earlier that its general business activity index increased to 12.8 in September from 5.0 in August, beating market calls for the index to remain unchanged.
Separately, industry data revealed that Chicago purchasing managers' index hit 55.7 in September from 53.0 in August, beating analysts' calls for a 54.0 reading
The data rekindled market expectations for the Federal Reserve to begin tapering its USD85 billion monthly bond-buying program this year, possibly later this month.
Fed asset purchases weaken the dollar by driving down interest rates to spur recovery, and talk of their dismantling can bolster the greenback.
The yen, meanwhile, was down against the pound and down against the euro, with GBP/JPY up 0.30% and trading at 159.03 and EUR/JPY trading up 0.04% at 132.89.
On Tuesday, Japan is to release data on household spending and average cash earnings, as well as reports on manufacturing and service-sector activity.
In the U.S., the Institute of Supply Management is to produce a report on manufacturing activity, a leading economic indicator.
In U.S. trading on Monday, USD/JPY was trading at 98.30, up 0.06%, up from a session low of 97.51 and off a high of 98.46.
The pair was likely to find support at 96.82, the low from Aug. 27, and resistance at 99.14, Thursday's high.
The U.S. Congress must approve a spending package by the end of the day to avoid a government shutdown, and waning faith for a last-minute deal steered investors away the dollar and into other safe-haven assets such as the yen earlier.
Congressional Republicans and Democrats continued to spar over President Barack Obama's healthcare law, a bargaining chip to fund a spending package to keep the government running.
Republicans oppose the president's healthcare reform and want it delayed in exchange for approving a spending deal, something the Democratically controlled Senate rejected on Monday.
Still, the dollar reversed earlier losses on better-than-expected economic indicators, which boosted expectations for the Federal Reserve to begin tapering stimulus programs once fiscal jitters subside.
The Federal Reserve Bank of Dallas reported earlier that its general business activity index increased to 12.8 in September from 5.0 in August, beating market calls for the index to remain unchanged.
Separately, industry data revealed that Chicago purchasing managers' index hit 55.7 in September from 53.0 in August, beating analysts' calls for a 54.0 reading
The data rekindled market expectations for the Federal Reserve to begin tapering its USD85 billion monthly bond-buying program this year, possibly later this month.
Fed asset purchases weaken the dollar by driving down interest rates to spur recovery, and talk of their dismantling can bolster the greenback.
The yen, meanwhile, was down against the pound and down against the euro, with GBP/JPY up 0.30% and trading at 159.03 and EUR/JPY trading up 0.04% at 132.89.
On Tuesday, Japan is to release data on household spending and average cash earnings, as well as reports on manufacturing and service-sector activity.
In the U.S., the Institute of Supply Management is to produce a report on manufacturing activity, a leading economic indicator.