EUR/JPY remains steady amid declining Eurozone PMI and easing inflation in Japan

EUR/JPY Holds Steady Near 184.00 Amid Mixed Economic Signals

The EUR/JPY pair remains stable around the 184.00 level, as recent Eurozone Purchasing Manager Index (PMI) figures reveal a notable slowdown in regional economic activity.

According to the latest Eurozone data, the Composite PMI slipped to 50.5 from 51.9, marking its lowest reading in ten months. The Services PMI also declined, dropping to 50.1 from 51.9. In contrast, the Manufacturing PMI offered a glimmer of optimism, rising to 51.4 from 50.8 and reaching its highest point in nearly four years.

Meanwhile, Japan’s National Consumer Price Index (CPI) increased by 1.3% year-over-year in February, a slight decrease from the previous 1.5%. Core inflation, which excludes fresh food, eased to 1.6% from 2.0%, falling short of the Bank of Japan’s (BoJ) 2% target.

This softer inflation data may present challenges for the BoJ as it considers policy normalization. Officials have reiterated their intention to raise interest rates if economic and price trends align with their expectations, emphasizing a commitment to achieving the 2% inflation goal in a sustainable manner.

Technical Outlook: Short-Term Trends

On the 4-hour timeframe, EUR/JPY is currently trading at 184.07. The short-term outlook is slightly positive, with the pair maintaining its position above multiple support levels and staying above both the 20-period and 100-period Simple Moving Averages (SMAs), which are trending higher near the mid-183.00s. The Relative Strength Index (RSI) stands at 59, suggesting ongoing buying interest without signaling overbought conditions.

Key support is found at 184.06, where the price remains above a significant horizontal level, followed by additional support at 183.82 and 183.67. These levels coincide with the upward-sloping SMAs, reinforcing the bullish sentiment as long as they hold. On the upside, a move beyond the current range could pave the way for new resistance above 184.10, with the positive bias persisting as long as the pair stays above 183.67.

(This technical analysis was generated with assistance from an AI tool.)