• EUR/JPY jumped to a fresh cycle high of 159.30.
• The EUR is trading strong against most of its rivals after the Bundesbank monthly report.
• PBoC's unexpected rate cut and BoJ’s dovish stance weaken the JPY.

On Monday, the EUR/JPY gained ground and established itself above 159.00, mainly driven by a stronger Euro. 

In that sense, the European currency traded strongly against its rivals after the Bundesbank monthly report indicated the inflation pressures could persist longer than the European Central Bank's (ECB) expectations. As a reaction, investors are betting on a more aggressive ECB as German yields increase, making the Euro gain interest. Focus now shift to Christine Lagarde’s speech on Thursday at the Jackson Hole Symposium, where investors will look for clues regarding forward guidance.

On the JPY’s side, the People’s Bank of China unexpectedly cut the one-year Loan Prime Rate (LPR) and reminded investors of the fragile economic situation in the Asian giant, which could further weaken the Japanese economy. In addition, it was reported that the Bank of Japan (BoJ) will consider tightening when it wage pressures increase, so the ultra-dovish stance also contributes to Yen’s downside