The Euro (EUR) is holding steady against the Japanese Yen (JPY) at approximately 177.60 during the early hours of trading on Friday. Notably, this comes close to a recent low of 176.66 reached the day before, which marks its lowest level in over ten months.
On Friday, the Japanese Yen is performing well overall, buoyed by stronger-than-expected Consumer Price Index (CPI) data from Tokyo for September. This news lends support to the anticipation of potential interest rate increases from the Bank of Japan (BoJ) in the near future.
The Tokyo CPI excluding Fresh Food recorded a year-on-year increase of 2.7%, surpassing both the forecast of 2.4% and last month’s figure of 1.8%. The headline inflation, too, jumped to 2.7%, up from 1.9% in August.
Discussions from the BoJ’s policy meeting summary revealed that some members are advocating for further tightening of monetary policy, indicating a focus on keeping underlying inflation anchored at around 2%.
Meanwhile, the Euro is poised to trade with caution. This stems from rising government bond yields in France, which have triggered concerns about public debt management. A report indicates that France’s public debt has reached 119% of its Gross Domestic Product (GDP), pushing the yield on 10-year French bonds to 4.96%—a peak not witnessed since August 2002.
In response to these developments, France’s Finance Minister Roland Lescure has committed to reforming public finances with an eye toward budget consolidation. The goal is to reduce the budget deficit from a target of 5% of economic output next year to under the EU limit of 3% by 2029.
As for economic releases, investors are awaiting the Eurozone’s preliminary Harmonized Index of Consumer Prices (HICP) data for September, which will be announced at 09:00 GMT.
