- EUR/JPY reverses recent downside and tests 121.40.
- EMU final CPI came in at 1.3% YoY and 0.2% MoM.
- ECB’s Coeure said risks still tilted to the downside.
The ongoing rebound in the demand for the single currency is now lifting EUR/JPY to the area of daily highs in the 121.40/454 band.
EUR/JPY now targets the 121.72/86 band
After three consecutive daily pullbacks, the cross is now attempting a rebound from weekly lows in the vicinity of the 121.00 handle.
US yields are bouncing off daily lows and are bolstering the selling mood in the Japanese safe haven, in turn lending support to the recovery in the EUR/JPY.
In the same line, final June inflation figures in the euro area came in a tad higher than the preliminary readings, showing headline consumer prices now rose at a monthly 0.2% and 1.3% from a year earlier. Core CPI, instead, matched the advanced readings at 1.1%.
Earlier in the day, ECB’s B.Coeure reiterated that risks in the euro region are still tilted to the downside.
Later in the NA session, the Fed will publish its Beige Book, which should shed further details on the recent performance of US regions.
EUR/JPY relevant levels
At the moment the cross is advancing 0.08% at 121.42 and faces the next hurdle at 121.86 (21-day SMA) seconded by 122.32 (high Jul.10) and then 123.35 (monthly high Jul.1). On the other hand, a breakdown of 121.09 (monthly low Jul.16) would expose 120.95 (low Jun.21) and finally 120.78 (low Jun.3).