EUR/JPY recovered from early weakness and traded close to flat around 187.35 after preliminary German data pointed to firmer momentum. Germany’s Q2 GDP rose 0.2% quarter-on-quarter, against 0.1% forecasts, easing from 0.3% in Q1. Year-on-year growth was 0.9%, above 0.6% expectations and up from 0.4%. July inflation readings from Germany’s six states were higher, setting the stage for the flash German Harmonised Index of Consumer Prices release due at 12:00 GMT.
Eurozone Growth and Inflation Developments
Across the Eurozone, Q2 output grew 0.4%, exceeding the 0.2% consensus and reversing a 0.2% contraction in Q1.
Focus On Japan’s Inflation and Monetary Policy
In Japan, attention turns to Friday’s Tokyo CPI and the Bank of Japan decision, with Tokyo CPI excluding fresh food seen at 1.7% year-on-year versus 1.6% in June. Market pricing implied a 99.3% probability of an unchanged overnight call rate, and Bloomberg’s survey showed all analysts expecting no move.
