Select Language

EUR/JPY trades with positive bias above 162.00; lacks follow-through ahead of ECB

Breaking news

EUR/JPY trades with positive bias above 162.00; lacks follow-through ahead of ECB

  • X
  • facebook
  • LINE
  • RSS

  • X
  • facebook
  • LINE
  • RSS
New update 2025.04.17 13:41
EUR/JPY trades with positive bias above 162.00; lacks follow-through ahead of ECB

update 2025.04.17 13:41

  • EUR/JPY gains positive traction for the second straight day amid a broadly weaker JPY.
  • BoJ rate hike bets, rising trade tensions, and recession fears could limit losses for the JPY.
  • A modest USD bounce weighs on the Euro and might cap the cross ahead of the ECB.

The EUR/JPY cross attracts buyers for the second straight day and climbs back above the 162.00 mark during the Asian session on Thursday. The intraday move higher is sponsored by the offered tone surrounding the Japanese Yen (JPY), though it is likely to remain capped as traders might opt to wait for the European Central Bank (ECB) interest rate decision.

The ECB is widely expected to cut its key interest rate by 25 basis points (bps), marking the sixth straight reduction amid the softening inflation and escalating trade risks. In fact, the final readings from Eurostat published on Wednesday showed that headline inflation in the Eurozone eased to 2.2% year-on-year in March, down from 2.6% the previous month. Moreover, core inflation, which strips out volatile components such as energy and food, fell to 2.4%, or the lowest since January 2022.

Meanwhile, US President Donald Trump imposed a 20% reciprocal tariff on EU imports before pausing for 90 days in pursuit of bilateral trade deals. However, a blanket 10% import tariffs remain in place, affecting around €380 billion worth of European goods. This has been fueling economic uncertainty, which might force the ECB to take a more dovish approach and show more concern over growth. Hence, the focus will also be on the ECB's updated economic projections and press conference.

Investors will closely scrutinize ECB President Christine Lagarde's comments for cues about the future interest rate path, which, in turn, will play a key role in influencing the Euro and provide a fresh impetus to the EUR/JPY cross. Heading into the key central bank event risk, a positive risk tone is seen undermining the safe-haven JPY and acting as a tailwind for spot prices. However, a modest US Dollar (USD) bounce weighs on the Euro and should cap any meaningful upside for the cross.

Moreover, the growing acceptance that the Bank of Japan (BoJ) will continue raising interest rates in 2025, the rapidly escalating US-China trade war, and global recession fears might continue to support the JPY. This makes it prudent to wait for strong follow-through buying before placing fresh bullish bets around the EUR/JPY cross. Even from a technical perspective, the recent repeated failures to find acceptance above the 200-day Simple Moving Average (SMA) warrant some caution for bulls.

Economic Indicator

ECB Main Refinancing Operations Rate

One of the three key interest rates set by the European Central Bank (ECB), the main refinancing operations rate is the interest rate the ECB charges to banks for one-week long loans. It is announced by the European Central Bank at its eight scheduled annual meetings. If the ECB expects inflation to rise, it will increase its interest rates to bring it back down to its 2% target. This tends to be bullish for the Euro (EUR), since it attracts more foreign capital inflows. Likewise, if the ECB sees inflation falling it may cut the main refinancing operations rate to encourage banks to borrow and lend more, in the hope of driving economic growth. This tends to weaken the Euro as it reduces its attractiveness as a place for investors to park capital.

Read more.

Next release: Thu Apr 17, 2025 12:15

Frequency: Irregular

Consensus: 2.4%

Previous: 2.65%

Source: European Central Bank


Date

Created

 : 2025.04.17

Update

Last updated

 : 2025.04.17

Related articles


Show more

FXStreet

Financial media

arrow
FXStreet

FXStreet is a forex information website, delivering market analysis and news articles 24/7.
It features a number of articles contributed by well-known analysts, in addition to the ones by its editorial team.
Founded in 2000 by Francesc Riverola, a Spanish economist, it has grown to become a world-renowned information website.

Was this article helpful?

We hope you find this article useful. Any comments or suggestions will be greatly appreciated.  
We are also looking for writers with extensive experience in forex and crypto to join us.

please contact us at [email protected].

Thank you for your feedback.
Thank you for your feedback.

Most viewed

US, China cite 'substantial progress' in Geneva trade talks - Bloomberg

China's Vice Premier He Lifeng described the weekend talks with US officials as "substantial progress" in stabilising bilateral trade relations, per Bloomberg. 
New
update2025.05.12 07:52

China's CPI inflation arrives at -0.1% YoY in April vs. 0.1% expected

China's Consumer Price Index (CPI) dropped at an annual pace of 0.1% in April after declining 0.1% in March.
New
update2025.05.12 07:34

AUD/NZD Price Analysis: Aussie holds near 1.0800 as bullish signals persist

The AUD/NZD pair edged higher on Friday, trading near the 1.0800 zone after the European session, reflecting a steady bullish tone as the market heads into the Asian session.
update2025.05.10 07:15

USD/JPY struggles as US Dollar Softens Ahead of Key Trade Talks

USD/JPY pair has pulled back toward 145.00 after failing to extend gains above a near one-month high of 146.20 earlier in the day.
update2025.05.10 06:45

EUR/JPY Price Analysis: Euro steadies near 164.00 as bullish structure holds firm

The EUR/JPY pair eased slightly on Friday, trading near the 164.00 zone after the European session, reflecting a modest pullback from recent gains.
update2025.05.10 06:24

Trump: The US will keep tariffs despite reaching trading deals

US President Donald Trump commented on Friday that he will maintain 10% universal tariffs on imports, even after trade agreements are reached with other countries. He added that there would be exemptions if their counterparts offered advantageous trading terms.
update2025.05.10 06:21

Australian Dollar under pressure as global trade and economic uncertainties persist

The Australian Dollar (AUD) remains under pressure as global trade uncertainties persist, particularly surrounding the US-China trade talks.
update2025.05.10 05:21

Mexican Peso firms despite weak data as trades turn cautious on US-China talks

The Mexican Peso (MXN) registered modest gains versus the US Dollar (USD) on Friday as market participants turned cautious ahead of the US-China talks in Switzerland.
update2025.05.10 05:05

Gold price rises over 1% on USD weakness as geopolitical tensions rise

Gold price climbed over 1% on Friday as the US Dollar (USD) retreated after posting two days of gains, weighed by lower US yields. A deterioration in risk appetite boosted Bullion prices, which are being underpinned by geopolitical concerns. At the time of writing, XAU/USD trades at $3,338.
update2025.05.10 03:39

Canadian Dollar flatlines on Friday as markets look elsewhere

The Canadian Dollar (CAD) flattened on Friday, sticking close to 1.3900 against the US Dollar (USD) as Loonie markets struggle to find a reason to move too far in either direction.
update2025.05.10 03:37

Disclaimer:arw

All information and content provided on this website is provided for informational purposes only and is not intended to solicit any investment. Although all efforts are made in order to ensure that the information is correct, no guarantee is provided for the accuracy of any content on this website. Any decision made shall be the responsibility of the investor and Myforex does not take any responsibility whatsoever regarding the use of any information provided herein.

The content provided on this website belongs to Myforex and, where stated, the relevant licensors. All rights are reserved by Myforex and the relevant licensors, and no content of this website, whether in full or in part, shall be copied or displayed elsewhere without the explicit written permission of the relevant copyright holder. If you wish to use any part of the content provided on this website, please ensure that you contact Myforex.

  • Facebook
  • Twitter
  • LINE

Myforex uses cookies to improve the convenience and functionality of this website. This website may include cookies not only by us but also by third parties (advertisers, log analysts, etc.) for the purpose of tracking the activities of users. Cookie policy

I agree
share
Share
Cancel