- EUR/JPY falls on Monday in the early session of Europe to 163.50.
- Trump's tariff uncertainty supports safe currencies such as JPY.
- The eurozone inflation rises in April.
The EUR/JPY cross will reach around 163.50 on Monday during the early session of Europe. The Japanese Yen (JPY) serves a larger euro (EUR) compared to growing safe demand in the midst of economic uncertainty. The trust of the eurozone Sentix investors will come on Monday later. Trading activities will be back on Monday due to Japan's public holiday.
US President Donald Trump reiterated that China was open to a trade agreement but did not offer specific details or schedule. In addition, Trump noted that the US does not have XI Jinping this week. Investor sentiment shifts sour, due to the uncertainty of lasting global trade that support JPY and act as a cross -life.
Japanese Bank (BOJ) kept its interest rate unanimous in a unanimous voice and reduced its growth forecast last week. The guidance of the Dovish of the Japanese Central Bank may be JPY upside down in the near future. Boj reduced his economic growth forecast to 0.5% to 1.1% for the financial year ended in March 2026, which was predicted three months ago. It also reduced its growth forecast to 0.7% expansion from 1.0% during the next financial year in January.
On the front of the EUR, eurozone inflation rose more than expected in April, potentially creating the European Central Bank (ECB) roads to make even lower interest rates in the coming months. ECB President Christine Lagarde said the central bank depends on the data on the interest rates. The ECB last reduced interest rates in April, bringing its deposit rate to 2.25%, which is 4.00% in mid -2012.
Japanese yen FAQ
Japanese yen (JPY) is one of the worlds traded in the world. Its value is widely determined by the Japanese economy, but more specifically the difference between the Japanese Bank's policy, the yield of Japanese and US bonds or traders' quality.
One of the banks of Japanese mandates is currency control, so its moves are key to yen. Boj has sometimes intervened directly in the foreign exchange markets to lower the value of yen in general, although it often refrains from the political problems of its main trade partners. Boj's super-light monetary policy in 2013-2024 made the yen depreciated against its main currency companions, as the political difference between the Japanese Bank and other central banks. Recently, this ultra-light politics have gradually relaxed a certain support to the yen.
Over the last decade, BOJ has caused the Political Policy to enlist the expansion of the Ultra-free monetary policy with other central banks, especially the US Federal Reserve. It supported the expansion of the differential of the 10-year-old US and Japanese bonds, which favored the US dollars towards Japanese yen. BOJ's decision in 2024 will gradually abandon the highly accurate politics with cutting interest rates in other major central banks.
Japanese yen is often considered a safe investment. This means that during the stress of market, investors are more likely to put their money into the Japanese currency due to their alleged credibility and stability. Turbulent times are likely to strengthen the value of yen to other currencies invested.
