EUR/JPY gains traction above 164.00 amid BoJ rate hike uncertainty

• EUR/JPY gains momentum to near 164.35 in Wednesday's Asian session.
• The Japanese Yen softens as the BoJ undecided on a rate hike.
• ECB's Kazaks said the central bank should go on cutting interest rates gradually.

The EUR/JPY cross edges higher to around 164.35 on Wednesday during the early Asian trading hours. The Japanese Yen (JPY) weakens against the Euro (EUR) amid the Bank of Japan (BoJ) rate hike uncertainty. The flash Eurozone Gross Domestic Product (GDP) data for the third quarter (Q3) will be the highlight on Thursday. 

The BoJ summary of opinions suggested a lack of clear direction regarding the timing of a rate hike as policymakers were split on whether to raise interest rates. Additionally, the political uncertainty in Japan has raised doubts over the Japanese central bank's ability to tighten its monetary policy further. This, in turn, weighs on the JPY and acts as a tailwind for EUR/JPY. 

On the Euro front, European Central Bank (ECB) Governing Council member Martins Kazaks said on Tuesday that the central bank should go on cutting interest rates gradually. Meanwhile, ECB policymaker Olli Rehn stated that further easing next month looks likely as disinflation in the euro area is "well on track" and the growth outlook "seems to be weakening. However, officials should remain cautious and move step by step. 

The markets have fully priced another 25 basis points (bps) rate cut from the ECB in its last meeting of the year in December. The ECB's deposit facility is currently at 3.25%.