Snapshot: EUR/JPY is holding steady near 170.20, with the relatively hawkish stance of the Bank of Japan providing underlying support. Masu’s speech early this morning reaffirmed the BoJ’s commitment to monitoring wage growth and its impact on inflation, reinforcing expectations for further policy normalisation. There are no major Eurozone or Japanese data releases before the 08:30 ET US data.
- Watch for a break above 170.50, which could signal renewed upside momentum driven by carry trades.
- Risk lies in any dovish shift in BoJ rhetoric or intervention threats from the MoF given sustained Yen weakness.
Bias into NY: Neutral to slightly bullish on EUR/JPY, targeting a move towards 170.80 if US yields continue their recent ascent and risk sentiment remains stable, though any surprise from this morning’s US data is likely to be a dominant driver.