- EUR/JPY gathers further upside traction north of 133.00.
- Higher US yields support the selling bias in the Japanese yen.
- US FOMC Minutes next of relevance in the US calendar.
The upbeat note in US yields put the Japanese currency under downside pressure and favors the continuation of the upside momentum in EUR/JPY to new highs around 133.50 on Wednesday.
EUR/JPY now looks to Fed
EUR/JPY adds to Tuesday’s advance and keeps the rally well and sound for yet another session, this time leaving behind the key barrier at 133.00 the figure, levels last seen in April 2018.
The pick-up in yields of the US 10-year benchmark lends extra legs to the selling mood surrounding the Japanese yen in a context where the risk-on mood seems somewhat deflated.
In the data space, final April inflation figures in the euro area noted the headline CPI rose 1.6% from a year earlier and 0.7% when comes to the Core CPI.
Later in the session, all the attention is expected to be on the release of the FOMC Minutes from the April 27-28 meeting. Investors will be closely following any mention of inflation and taper discussion.
EUR/JPY relevant levels
So far, the cross is gaining 0.23% at 133.37 and a surpass of 133.43 (2021 high May 19) would pave the way for a test of 133.48 (monthly high Apr.2018) and then 134.00 (round level). On the downside, the next support at 131.64 (weekly low May 12) seconded by 130.98 (monthly low May 5) and finally 130.62 (50-day SMA).
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