Expectations of Bank of Japan tightening and weak German factory data weigh on the Euro, pushing EUR/JPY lower.
EUR/JPY fell 0.32% to 184.10 on Monday, driven by bets on Bank of Japan rate hikes and warnings from Japanese authorities over currency weakness. The Euro failed to gain despite an improvement in the Eurozone Sentix Investor Confidence Index to -13.4 in June from -15.4 in May.
German factory orders declined 3.8% month-on-month in April, missing expectations of a 1.2% drop and reversing a revised 4.5% gain in March. Annual orders rose just 1.6%, signaling slowing momentum in Europe’s largest economy.
Markets await the European Central Bank’s policy meeting this week, with a 25-basis-point hike fully priced in. Economists expect another hike in September, citing persistent inflationary pressures.