In Monday’s Asian session, EUR/JPY faces selling pressure, dropping to 166.65 from a high of 171.60. This decline is attributed to speculation of potential intervention by the Bank of Japan to prevent the Japanese Yen from depreciating further. Japanese policymakers have expressed readiness to intervene if necessary, leading to a rebound in the Japanese Yen despite it reaching a multi-decade low.
Meanwhile, European Central Bank officials have hinted at a possible decrease in the deposit rate in June due to cooling inflation in the Eurozone. Investors are awaiting the release of the German Consumer Price Index data and Eurozone GDP figures for Q1, which could impact the EUR/JPY cross. A stronger-than-expected outcome in these reports could boost the Euro and limit downside potential for EUR/JPY.