EUR/JPY attracts some buyers above 164.00 amid BoJ rate hike uncertainty

• EUR/JPY gains momentum to around 164.25 in Tuesday's early European session, up 0.32% on the day.
• The Japanese Yen tumbles amid BoJ rate hike uncertainty.
• Investors brace for the preliminary reading of the Eurozone HICP inflation data, which is due late on Tuesday.

The EUR/JPY cross extends the rally to near 164.25 during the early European session on Tuesday. The Japanese Yen (JPY) weakens amid the uncertainty about the timing of the Bank of Japan's (BoJ) next interest rate hike. The preliminary reading of the Eurozone Harmonized Index of Consumer Prices (HICP) for December will be the highlight later on Tuesday. 

BoJ Governor Kazuo Ueda said that the "timing of adjusting monetary support depends on economic, price and financial developments. Ueda's comments didn't offer any hints about the timing of a rate hike. This, in turn, could undermine the JPY and create a headwind for EUR/JPY. 

Nonetheless, the fresh verbal intervention from the Japanese authorities might boost the JPY and cap the downside for EUR/JPY. On Tuesday, Japan Finance Minister Katsunobu Kato said, "The Japanese government has been alarmed by foreign exchange developments, including those driven by speculators, and will take appropriate action against excessive moves."

On the Euro front, the stronger-than-expected PMI data from Spain, Italy, France, Germany, and the Eurozone support the shared currency. Investors will take more cues from the Eurozone inflation data, which might influence market expectations for the likely European Central Bank (ECB) interest rate reductions in the next meeting.