- The EUR/JPY maintains its position despite a rate of rates by the Bank of Japan on Friday.
- The BOJ raised its short-term rate at 25 basic points up to 0.40%-0.50%, marking the highest rate since 2008.
- The euro is strengthened as the feeling of risk improves after the recent comments of the US President Donald Trump.
The EUR/JPY recovers recent losses, around 163.00 during Friday’s Asian session. The EUR/JPY crossing remains resilient despite the Bank of Japan (BOJ) raised its short-term rate in 25 basic points (PB) of 0.15% -0.25% to 0.40% -0.0.50% after its review of its review of monetary policy of two days. This movement, in line with market expectations, marks the highest rate level since 2008 after three consecutive meetings being stable.
The data of the Japan Statistics Office published on Friday showed that the National Consumer Price Index (CPI) rose 3.6% year -on -year (YOY) in December, compared to 2.9% of the previous month. Underlying consumer prices increased as expected, rising from 2.7% to 3.0%, the highest level since mid -2023. In addition, the underlying measure that excludes fresh food prices and energy remained stable, rising 2.4 % year -on -year in December, backed by robust private consumption.
The euro can be seen in front of its peers in the midst of an improvement in the feeling of risk after the recent comments of the US president, Donald Trump. Trump said he wants the US Federal Reserve (Fed).
In addition, Trump expressed optimism, stating that “I would prefer not to have to wear tariffs on China” and is hopeful to reach an agreement. Trump’s comments occurred after his conversation with the president of China, Xi Jinping, Thursday, hinting at possible progress in commercial negotiations between the US and China.
However, the euro rise could be limited since the markets anticipate a reduction in rates of 25 basic points (PB) in each of the next four monetary policy meetings of the ECB, driven by concerns about the economic perspectives of the Eurozone and the belief that inflationary pressures will remain moderate.
Economic indicator
BOJ interest rates
He Bank of Japan Set the interbank interest rate. This rate affects a range of interest rates set by commercial banks, construction societies and other institutions towards their own savers and borrowers. It also affects the price of financial assets, such as bonds, actions and exchange rates, which affect the consumer and the demand for businesses in a variety of forms. If the Bank of Japan has a firm perspective with respect to the Japanese economy and increases the current interest rate, this is upward to the YEN. Instead, a slight perspective that leads to the bank to reduce or maintain current types will be bassist for the YEN.
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Last publication:
Vie Jan 24, 2025 03:23
Frequency:
Irregular
Current:
0.5%
Dear:
0.5%
Previous:
0.25%
Fountain:
Bank of Japan
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
