EUR/JPY aims to recapture 144.00 ahead of ECB Lagarde’s speech
|- EUR/JPY is inching towards its seven-year high at 144.25 as investors await ECB's Lagarde.
- The speech from ECB President Lagarde is expected to remain hawkish on interest rates amid soaring inflation.
- The continuation of an ultra-loose monetary policy will keep the yen bulls on the tenterhooks.
The EUR/JPY pair is oscillating in a minor range of 143.17-143.36 in early Tokyo. Broadly, the asset is modestly advancing after sensing a rebound near Thursday’s low at 141.58. The cross is aiming to recapture its seven-year high at 144.25 as investors are awaiting the speech from European Central Bank (ECB) President Christine Lagarde, which is due on Tuesday.
ECB Lagarde is expected to dictate the roadmap of elevating the interest rates to combat the inflation monster. It is worth noting that the ECB has not followed the footprints of its Western mates and has not elevated its policy rates yet. The inflation rate has climbed above 8% in the eurozone and the only measure that has been taken by the ECB to contain inflation is the ending of the Asset Purchase Program (APP).
This time a rate hike announcement by the ECB looks likely as the inflation situation has turned into a mess and the households are facing the headwinds of the same.
On the Tokyo front, a continuation of an ultra-loose monetary policy by the Bank of Japan (BOJ) will keep the Japanese yen on the tenterhooks. Despite the achievement of the desired inflation rate, the BOJ is unable to elevate its interest rates as the price pressures are majorly contributed by costly fossil fuels and food prices. For further guidance, investors will keep an eye on the Retail Trade data, which is due on Wednesday.
As per the market estimates, Japan’s Retail Trade is seen at 3.3%, higher than the former print of 2.9% on an annual basis. While the monthly Retail Trade may drop to -0.1% vs. 0.8% recorded earlier.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.