Euro underperforms against Japanese Yen amid Japan’s intervention fears

The Japanese Yen strengthened against major currencies in European trade on Monday, with the EUR/JPY pair falling 0.4% to approximately 178.40. The Yen continued to gain support from verbal warnings from Japan about potential intervention to stabilize its currency. This comes after Atsushi Mimura, Japan's top currency diplomat, emphasized that markets should take Tokyo and Washington's message about the Yen seriously, signaling his intention to act against excessive currency drops.

Japanese Finance Minister Satsuki Katayama also noted that U.S. President Donald Trump expressed concern over the Yen's weakness during a meeting with Prime Minister Sanae Takaichi in New York, where a joint intervention was discussed on July 31. Katayama reiterated that the principles for a potential joint intervention remained relevant.

Investors are currently waiting for Tokyo's Consumer Price Index (CPI) data for September, which is expected to show accelerated inflation excluding fresh food at 2.4% year-over-year, up from 1.8% previously. Meanwhile, the Euro underperformed at the beginning of the week, with investors focusing on preliminary German and Eurozone Harmonized Index of Consumer Prices (HICP) data for September. Both regions are anticipated to experience stronger price pressures.