The EUR/JPY pair has sensed selling pressure after failing to sustain above the critical resistance of 144.00 in the Asian session. The cross is expected to turn sideways ahead of the release of the inflation figures by Germany and Tokyo. The asset is aiming higher for the past four trading sessions amid receding expectations of an exit from the ultra-loose monetary policy by the Bank of Japan (BoJ).

Investors are shifting their focus toward the release of the preliminary German Harmonized Index of Consumer Prices (HICP) data. As per the consensus, monthly German HICP is expected to expand by 0.8% vs. the former release of 1.0%. On an annual basis, German HICP would soften dramatically to 7.5% from the prior release of 9.3%.

It seems that the continuation of the policy-tightening spell by the European Central Bank (ECB) is showing its impact on inflationary pressures. ECB policymaker Peter Kazimir cited on Wednesday “I think inflation is too high for too long.” He further added that the ECB will consider the financial situation before arriving at the interest rate decision. ECB Kazimir believes “There is a genuine danger that banks will cut back on lending.”

About interest rate guidance, ECB Kazimir is of the view, “We should continue in raising rates, possibly at a slower pace.”

On the Japanese Yen front, declining international oil prices have weighed heavily on Japan’s inflation. The street is anticipating further softening of the headline Tokyo CPI to 2.7% from the former release of 3.4%. While the core CPI that excludes oil and food prices is seen expanding to 3.3% from the former release of 3.2%.