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Euro gains vs Japanese yen as Germany business sentiment improves

EUR/JPY rose to about 185.85, helped by an Ifo Business Climate Index jump to 88.8 for August.

Reported · Written up by our desk · Major Pairs

EUR/JPY moved higher on Tuesday, trading around 185.85, up 0.15% on the day, as the euro gained support from a stronger improvement in German business sentiment, according to FXStreet.

The Ifo Institute Business Climate Index rose to 88.8 in August from a revised 86.7 in July, topping expectations of 87.2, with the Current Assessment Index increasing to 88.5 and the Expectations Index climbing to 89.1, both above forecasts.

On the yen side, FXStreet said the Japanese currency remained pressured by concerns about Japan’s public finances and the persistence of a wide interest-rate differential, even after a coordinated US-Japan intervention in late July.

FXStreet also cited BNY Mellon strategists, who argued that inflation remains the core issue in Europe and warned that tightening too early could be a mistake, while noting “Goldilocks” signs in preliminary August PMIs and easing inflation expectations.

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