Snapshot: The Euro/Yen remains well-supported as today’s ECB wage tracker confirms stable negotiated wage pressures for 2026, reinforcing the ECB doves’ cautious stance while limiting the scope for aggressive near-term rate cuts. This domestic wage resilience, paired with ECB President Lagarde’s scheduled address at 12:50 CET, keeps the pair on a firm footing ahead of the New York open. The structural upside is further insulated by a soft-landing narrative in the US, though the BoJ’s slow normalisation bias limits runaway gains.
- The ECB’s fresh wage tracker release shows stable negotiated wage pressures, preserving the 2.50% deposit rate floor for now and preventing a deeper dovish repricing ahead of Lagarde’s speech.
- Yen weakness past prior intervention zones keeps MoF communication risk exceptionally high, making any sudden JPY short-covering a primary threat during thin NY liquidity.
Bias into NY: We maintain a bullish bias on EUR/JPY, targeting a break above 171.50, as sticky Eurozone wage dynamics keep the ECB’s easing cycle shallow while JPY remains structurally offered despite intervention threats.