EUR/JPY Trades Flat Ahead of Central Bank Rate Hikes
The EUR/JPY pair has been trading in a tight range, as investors weigh expectations of rate hikes from both the European Central Bank (ECB) and the Bank of Japan (BoJ) at their September meetings.
While the ECB is widely expected to deliver a 25-basis-point hike, with its deposit rate standing at 3.75% as of August 2025, the BoJ has been maintaining ultra-loose policy for years, but recent comments from Governor Kazuo Ueda have hinted that it could adjust its yield curve control or raise rates to counter inflation.
This balance of forces has left the cross currency in a state of equilibrium, with traders looking for fresh catalysts. The euro's inability to push higher against the yen reflects the cautious stance of market participants ahead of key central bank decisions.