EUR/JPY climbs to one-week top, closer to mid-162.00s amid weaker JPY
22.01.2025, 05:45

EUR/JPY climbs to one-week top, closer to mid-162.00s amid weaker JPY

  • EUR/JPY scales higher for the fourth straight day amid the emergence of some JPY selling.
  • The divergent BoJ-ECB policy expectations should keep a lid on the upside for the cross.
  • Traders now look to ECB President Christine Lagarde's speech for short-term opportunities.

The EUR/JPY cross attracts follow-through buyers for the fourth straight day on Wednesday and looks to build on its recovery from the 159.70-159.65 area, or over a one-month low touched last week. The intraday positive move lifts spot prices to a one-week top, around the 162.35-162.40 area during the Asian session and is sponsored by the emergence of some selling around the Japanese Yen (JPY).

The global risk sentiment remains well supported by the Israel-Hamas ceasefire agreement and hopes that US President Donald Trump might relax curbs on Russia in exchange for a deal to end the Ukraine war. Adding to this, Trump's proposed trade tariffs lacked details, which further boosted investors' appetite for riskier assets. This, in turn, is seen undermining demand for the safe-haven JPY and acting as a tailwind for the EUR/JPY cross.

That said, the growing acceptance that the Bank of Japan (BoJ) will raise interest rates on Friday should limit any meaningful JPY depreciation. Furthermore, a modest US Dollar (USD) strength, along with Trump's threat to impose tariffs on the European Union and bets that the European Central Bank (EC) will lower borrowing costs further, seem to weigh on the shared currency and should cap any further gains for the EUR/JPY cross. 

The aforementioned fundamental backdrop and the recent repeated failures near the 200-day Simple Moving Average (SMA) warrant some caution for bullish traders. Hence, it will be prudent to wait for strong follow-through buying before positioning for any further appreciating move. Traders now look to ECB President Christine Lagarde's speech for some impetus, though the focus will remain glued to the crucial BoJ policy meeting.

Japanese Yen PRICE Today

The table below shows the percentage change of Japanese Yen (JPY) against listed major currencies today. Japanese Yen was the strongest against the New Zealand Dollar.

  USD EUR GBP JPY CAD AUD NZD CHF
USD   0.08% 0.02% 0.25% 0.02% 0.13% 0.23% 0.12%
EUR -0.08%   -0.07% 0.16% -0.07% 0.05% 0.15% 0.04%
GBP -0.02% 0.07%   0.23% -0.00% 0.12% 0.21% 0.09%
JPY -0.25% -0.16% -0.23%   -0.22% -0.12% -0.03% -0.15%
CAD -0.02% 0.07% 0.00% 0.22%   0.12% 0.21% 0.08%
AUD -0.13% -0.05% -0.12% 0.12% -0.12%   0.10% -0.03%
NZD -0.23% -0.15% -0.21% 0.03% -0.21% -0.10%   -0.13%
CHF -0.12% -0.04% -0.09% 0.15% -0.08% 0.03% 0.13%  

The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Japanese Yen from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent JPY (base)/USD (quote).

 

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