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Euro holds steady vs yen as ECB and BoJ meetings loom

EUR/JPY is trading around 185.7, with Germany PPI rising 1.8% year over year in June and producer prices falling 0.3% month over month.

Reported · Written up by our desk · Major Pairs

EUR/JPY was little changed on Monday, trading around 185.7 as investors stayed cautious ahead of multiple central bank meetings and amid Middle East tensions that have kept pressure on the oil complex, according to FXStreet.

On the Eurozone side, Monday's data showed Germany's Producer Price Index increased 1.8% year over year in June, easing from May's 2.2% gain. On a monthly basis, producer prices fell 0.3%, worse than the 0.2% decline expected by markets.

Attention then turns to the European Central Bank policy meeting on Thursday, where markets widely expect rates to be left unchanged after the ECB's prior 25 basis point increase. Traders will look for signals in the policy statement and comments from ECB President Christine Lagarde, including whether another rate hike could be in view for September.

FXStreet also noted that EUR could face additional headwinds if geopolitical risks intensify, while investors are watching the risk of Japanese foreign exchange intervention. Japanese Finance Minister Satsuki Katayama said the government stands ready to take decisive action to counter excessive yen moves, and FXStreet cited a Kyodo report that the Bank of Japan is expected to keep its policy rate unchanged at 1% next week.

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