Dollar nudges lower

LONDON, May 29 (Reuters): The dollar nudged lower on Monday, pulling back from six-month peaks against the yen as a US debt ceiling deal lifted risk appetite across world markets and dented the greenback's safe-haven appeal.

US President Joe Biden on Sunday finalised a budget agreement with House Speaker Kevin McCarthy to suspend the $31.4 trillion debt ceiling until Jan. 1, 2025, and said the deal was ready to move to Congress for a vote.

Having briefly touched a six-month high of 140.91 yen during Asia trade, the dollar drifted lower and was last down 0.25 per cent at 140.25 yen.

The dollar index , which measures the US unit's value against a basket of other major currencies, was also a touch softer around 104.22 but not far from last week's two-month peaks.

The pull-back in the safe-haven dollar came as world stocks rallied on the positive news from Washington, although trade was generally subdued with parts of Europe, including Britain, on holiday. Monday was also a holiday in the United States.

"An initial risk-on reaction is likely as the cloud of US default has retreated," said Charu Chanana, a market strategist at Saxo Markets in Singapore.