EUR/JPY rebounds from 143.10 despite robust Japan Retail Sales data, Germany HICP eyed
- EUR/JPY has found bids around 143.00 after the release of Japan’s Retail Trade.
- The ECB may elevate its interest rates by 25 bps in July and more in September monetary policy.
- An improvement to 8.8% is expected in Germany HICP vs. 8.7% recorded earlier.
The EUR/JPY pair has attracted some significant bids despite the release of the higher-than-expected Japan’s Retail Trade. Japan’s Ministry of Economy, Trade, and Industry have reported the economic data at 3.6% on an annual basis which remained principally higher than the expectations of 3.3% and the prior print of 2.9%.
While the monthly Retail Trade slipped to 0.6% from the prior print of 1% but remained higher than the consensus of -0.1%. The agency has reported robust Large Retailer Sales data. The figure has climbed to 8.5%, significantly higher than the forecasts of 1.3% and the prior print of 4%.
On a broader note, the economic data has remained firmer and indicates a higher consumption pattern in May month. This signals that the overall demand in the economy is gaining traction, which may support a shift to a neutral policy by the Bank of Japan (BOJ) from the ongoing ultra-loose monetary policy.
On the eurozone front, the comments from European Central Bank (ECB) Christine Lagarde in her introductory speech on Day 2 of the ECB Forum on Central Banking in Sintra, Portugal, failed to lift the shared currency bulls. The ECB sees a rate hike by 25 basis points (bps) in July and it is open to dictating a higher rate hike in September. Apart from that, the Germany Harmonized Index of Consumer Prices (HICP) will remain in focus. As per the market consensus, the German HICP may improve to 8.8% from the former figure of 8.7%.
Author
Sagar Dua
FXStreet
Sagar Dua is associated with the financial markets from his college days. Along with pursuing post-graduation in Commerce in 2014, he started his markets training with chart analysis.
