Japanese Yen gains as traders brace for potential currency intervention amid geopolitical developments and weak Eurozone sentiment.
The EUR/JPY pair fell to 181.70 in early European trading, extending losses as the Japanese Yen strengthened. Market participants remain cautious over potential intervention by Japanese authorities following recent coordinated efforts with the U.S. to stabilize the currency.
The cross remains under pressure below its 20-day moving average, reinforcing a bearish technical outlook. Analysts suggest the Yen’s recovery hinges more on Japan’s growth prospects than faster Bank of Japan rate hikes, per Societe Generale.
Risk sentiment may improve if U.S.-Iran talks yield progress, with reports indicating a potential interim deal to reopen the Strait of Hormuz. Such developments could offer temporary support to the Euro against the Yen.