EUR/JPY rebounds from 136.00, downside looks likely on weak estimates for Eurozone GDP

• A short-lived rebound by the EUR/JPY pair has turned into a fresh downside wave.
• Eurozone GDP is likely to land on the downside to 3.4% vs. 5.4% reported earlier.
• Japanese Ministry of Finance has announced a budget reserve of 257 billion yen to combat il and food prices.

The EUR/JPY pair has picked bids around 136.00 and a modest rebound has been displayed. The short-lived reversal is likely to evaporate sooner as investors are awaiting the release of the eurozone Gross Domestic Product (GDP), which is due on Friday.

As per the market expectations, the eurozone GDP is expected to shift lower to 3.4%from the prior release of 5.4%. The European economy is facing the headwinds of an energy crisis as demand for energy is expected to surge due to the upcoming Winter season and Russia has cut off the gas supply from its main pipeline.

It is worth noting that the European Union (EU) was already looking for another potential that could address its bumper demand for oil and gas. However, finding an energy supplier who can offset the energy imports from Russia is not a cakewalk. Europe caters to more than 25% of its oil and gas demand from Russia and it's core member Germany has significant dependence on energy imports from Russia. This has weakened the shared currency bulls dramatically.

On the Tokyo front, the announcement of helicopter money by the Japanese Ministry of Finance to combat rising oil and food product prices has surprisingly strengthened the yen bulls. The agency has announced a budget reserve of 257 billion Japanese yen. The Bank of Japan (BOJ) is committed to keeping the inflation rate above 2%, and soaring oil prices have managed to keep the inflation rate. However, the desired inflation rate with costly fossil fuels is not lucrative for households.