EUR/JPY Holds Steady Amid BoJ’s Hawkish Stance and Japan’s Slowing Services Sector
The EUR/JPY pair remains near 165.50 during Wednesday’s Asian trading session, supported by the Bank of Japan’s (BoJ) latest hawkish minutes. The minutes reveal a unified stance among board members favoring continued interest rate hikes, aligning with Japan’s inflation and economic objectives. This bolstered the Japanese Yen, although recent data also signals challenges for Japan’s economy. The Jibun Bank Japan Services Business Activity Index, for instance, fell to 49.7 in October from 53.1 in September. This marginal contraction—the first since June—reflects slowing sales and signals potential headwinds in Japan’s service sector.
In Europe, Eurozone Gross Domestic Product (GDP) growth exceeded expectations, prompting traders to reduce expectations of a more significant interest rate cut from the European Central Bank (ECB) at its December policy meeting. Current market sentiment anticipates a standard 25-basis-point reduction in the ECB’s Deposit Facility Rate next month. Investors now await PMI data for Germany and the broader Eurozone, along with comments from ECB President Christine Lagarde and Vice President Luis de Guindos, both scheduled to speak later in the day.
US Presidential Election Update: Early Exit Poll Insights
In the U.S. presidential election, early exit polls reveal a strong lead for Republican candidate Donald Trump in Wisconsin, with 56% of the vote to Kamala Harris’ 42.5%, based on 7.5% of expected votes counted. North Carolina presents a tighter race, with 50% of votes counted. Meanwhile, in Michigan, Harris’ lead has decreased from 61% to 53% with 12% of votes counted. As election results unfold, market participants remain alert to potential shifts that may impact global financial markets.
