- EUR/JPY posts modest gains around 164.10 in Tuesday’s early European session.
- Some spoken intervention from Japanese authorities raises the Japanese Yen.
- ECB’s Panetta stated the inflation pattern was making a rate cut possible.
The EUR/JPY cross trades with a moderate bullish predisposition above the 164.00 mark throughout the early European session on Tuesday. The intervention caution from the Japanese authorities on Monday supplies some assistance to the Japanese Yen (JPY) and may top the cross’s advantage in the near term. Traders will carefully keep an eye on the Tokyo Consumer Rate Index (CPI) for March, due on Friday. At press time, the cross is trading at 164.10, acquiring 0.01% for the day.
The Japanese Yen has actually dropped regardless of the Bank of Japan’s (BoJ) raising interest rates recently, marking the very first walking because 2007. Japan’s Vice Minister of Finance for International Affairs, Masato Kanda made some spoken intervention on Monday, stating that he will take proper actions to react to the extreme weak point of the Japanese Yen without leaving out any procedures. This, in turn, raises the JPY and serves as a headwind for the EUR/JPY cross.
On the other hand, traders increased their bets on rate cut expectations from the European Central Bank (ECB) after the Swiss National Bank (SNB) ended up being the very first significant reserve bank to lower loaning expenses recently. The ECB policymaker Fabio Panetta mentioned on Monday that the reserve bank is moving towards a rate of interest cut as inflation is falling quickly and approaching the bank’s 2% target. ECB chief economic expert Philip Lane stated that the ECB is more positive that wage development is slowing back towards more regular levels, possibly opening the door to rate cuts.
The German Gfk Consumer Confidence Survey for April is due on Tuesday, together with the ECB’s Lane speech. Traders will enjoy the German February Retail Sales on Thursday. On Friday, the Japanese Tokyo CPI inflation information for March will remain in the spotlight.
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