By ALEXANDER MARTIN The dollar moved in a tight range against the yen during Asian trading Thursday as the market remained focused on ongoing negotiations on the U.S. "fiscal cliff" and on Japan's upcoming general election. The yen weakened slightly in early trading when Japan's main opposition leader Shinzo Abe said during a speech in Tokyo that the Bank of Japan should carry out "unlimited" monetary easing until it reaches a 2% inflation target. While his remarks were repetitions of earlier statements, some traders still sold the yen in a knee-jerk reaction. Mr. Abe, considered the front-runner to become the next prime minister, has been rocking the markets with calls for aggressive monetary easing. But Daisuke Karakama, market economist and vice president of forex sales at Mizuho Corporate Bank, said the impact of Mr. Abe's remarks was wearing off, and the focus was shifting to whether such policies could actually be implemented if the LDP comes to power. "The main theme from now to the year-end will be the fiscal cliff negotiations and Japan's election," he said. Mr. Karakama said he will be watching an on-line debate tonight between Mr. Abe, Prime Minister Yoshihiko Noda and other party leaders. Citibank Japan chief strategist Osamu Takashima said the dollar/yen was in a correction phase after its recent rise, and could fall toward ¥81 in the near term. Investors have been aggressively selling the yen for the past two weeks on expectations for more Bank of Japan easing, with the dollar topping ¥82 last week for the first time in seven months. But Junichi Ishikawa, forex analyst at IG Market Securities, said the yen-weakening trend could reassert itself if any positive headlines from the fiscal cliff negotiations come out, improving risk appetite in U.S. shares. Automatic spending cuts and tax increases will kick in unless Congress reaches a comprehensive deficit-reduction deal. Mr. Ishikawa cited persistent views that U.S. President Barack Obama could manage to reach a "grand bargain" with Congress, and that view could limit the impact of any negative headlines to the range of position adjustments in the meantime. As of 0450 GMT, the dollar was at ¥82.10 from ¥82.08 late New York trading Wednesday. The euro was at $1.2953 from $1.2953 and at ¥106.33 from ¥106.32. The Wall Street Journal Dollar Index, which measures the dollar against a basket of currencies, was at 70.333 from 70.313.

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