EUR/JPY attracts some buyers to near 163.00 amid BoJ rate hike uncertainty

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  • EUR/JPY gains momentum to near 163.00 in Monday’s early Asian session, up 33% on the day. 
  • The lack of clear guidance on the next BoJ rate hike timing weighs on the JPY. 
  • ECB’s Cipollone said the central bank should cut rates further to support recovery.

The EUR/JPY cross attracts some buyers to around 163.00 during the early European session on Monday. The Japanese Yen (JPY) weakens against the Euro (EUR) amid the uncertainty over the Bank of Japan's (BoJ) rate-hike plans. The European Central Bank (ECB) Vice President Luis de Guindos and Phillip Lane are scheduled to speak on Monday. 

The BoJ Kazuo Ueda said this Monday that the timing for when the central bank adjusts the degree of our monetary support will depend on the economic, price, and financial outlook. Ueda further stated that the Japanese central bank wouldn't necessarily wait for external risks to completely fade before hiking again. Nonetheless, he offered few clues on whether the BoJ would raise rates in December. The lack of clear guidance on the next rate hike timing exerts some selling pressure on the JPY and creates a tailwind for EUR/JPY. 

The verbal intervention from the Japanese authorities could provide some support to the JPY and cap the upside for the cross. Japan's Finance Minister Katsunobu Kato said on Friday that the Japanese government will scrutinize the Foreign exchange market with very high vigilance and take appropriate action against excessive moves.



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