EUR/JPY retreats for second day as Yen strengthens, Euro weighed by softer development revision

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EUR/JPY retreats for second day as Yen strengthens, Euro weighed by softer growth revision

EUR/JPY slides towards 163.00, testing key help from the ascending trendline and the 200-day EMA.
The Euro stays beneath stress after Q1 GDP was revised decrease regardless of upbeat industrial output.
Secure-haven flows enhance the Yen amid cautious danger sentiment.

EUR/JPY prolonged its pullback for a second consecutive session on Thursday, falling 0.5% to commerce round 163.00, with the Japanese Yen (JPY) gaining traction on safe-haven flows. The Euro (EUR) additionally got here beneath stress after Eurozone development knowledge confirmed indicators of moderation, prompting merchants to reassess the area’s near-term outlook.

The most recent financial knowledge confirmed the Eurozone economic system grew by 0.3% in Q1, barely beneath the preliminary estimate of 0.4%, although it nonetheless marked the sixth straight quarter of growth. Annual development held regular at 1.2%, whereas Industrial Manufacturing stunned to the upside with a 2.6% MoM bounce in March. Regardless of the economic beat, the softer Gross Home Product (GDP) print retains stress on the European Central Financial institution (ECB) to keep up a dovish stance, notably as inflation continues to ease.

The Japanese Yen attracts help from broader macroeconomic and geopolitical elements. Persistent world commerce uncertainties pressured the US Greenback (USD), lifting different main currencies, together with the Yen. A broader rally in Asian currencies was additionally underway, pushed by hypothesis that the US administration is favoring a weaker Greenback to rebalance commerce flows. Washington has repeatedly argued that undervalued Asian currencies supply an unfair benefit to regional exporters. In the meantime, consideration is popping to the US-Japan commerce negotiations, with Tokyo aiming to safe a deal by June.

From a technical perspective, EUR/JPY is at present testing an ascending trendline from the March lows, converging with the 200-day Exponential Shifting Common (EMA) at 161.86. This zone stays a key space of help. The broader construction stays intact so long as this degree holds, with consumers more likely to step in on dips. A sustained break beneath the trendline-EMA confluence would sign potential for additional draw back towards 160.50.

The Relative Energy Index (RSI) has eased to 50.9, hovering in impartial territory and suggesting a pause in bullish momentum moderately than a full pattern reversal. On the upside, 164.50 continues to cap positive factors, and a breakout above this degree is required to renew the bullish bias.EUR/JPY stays at a vital juncture, with the 162.00–161.85 zone appearing as a key technical pivot. A bounce might set off recent bullish momentum, however a break decrease would shift the near-term bias in favor of the Yen.