EUR/JPY stays above 177.50 near all-time highs amid fading likelihood of BoJ rate hikes

• EUR/JPY maintains its position near the all-time high of 177.86 reached on Wednesday.
• The non-yielding Silver may further advance as the FOMC Meeting Minutes suggested potential for further rate cuts.
• The incoming Prime Minister of Japan, Sanae Takaichi, is expected to boost fiscal spending while maintaining a loose monetary policy.

EUR/JPY continues its winning streak for the fifth successive session, trading around 177.60 during the Asian hours on Thursday. The currency cross remains close to the fresh all-time high of 177.86 recorded on Wednesday, as the Japanese Yen (JPY) struggles as political shifts dampened the odds for the rate hikes by the Bank of Japan (BoJ).

The incoming Prime Minister of Japan, Sanae Takaichi, a vocal supporter of Abenomics-style stimulus, is expected to increase fiscal spending alongside continued loose monetary policy. BoJ Governor Kazuo Ueda recently indicated that the central bank may raise interest rates if economic and price developments align with expectations, while cautioning that downside risks to growth remain.

However, the upside of the EUR/JPY cross could be restrained as the Euro (EUR) could face challenges amid mounting political turmoil in France, the second-largest economy in the Eurozone. French President Emmanuel Macron remains under pressure to call early elections or step down to end the political turmoil.

Following his unexpected resignation, outgoing Prime Minister Sébastien Lecornu began two days of negotiations. On Wednesday, Lecornu indicated that dissolving parliament was unlikely, while the talks revealed a consensus to approve a budget by year-end.

On the Eurozone's policy stance, European Central Bank (ECB) policymaker and Bundesbank President Joachim Nagel said on Wednesday that "the ECB's current monetary policy is appropriate." "Eurozone inflation is close to the medium-term target of 2%, seen remaining there in the coming years," Nagel added.