The Euro (EUR) rose against the Japanese Yen (JPY), holding around 182.00 after registering over 0.5% gains in the previous day during European trading hours on Wednesday. This upward movement was supported by the release of HCOB Purchasing Managers’ Index (PMI) data from Germany and the Eurozone. The HCOB Eurozone Composite PMI rebounded into expansion territory in July, rising to 52.0 from June's neutral 50.0, marking the first increase in regional business activity since March and the sharpest rate of growth in eight months. The Eurozone Services PMI advanced from 49.4 in June to 51.7 in July, ending a three-month decline and achieving its fastest growth rate since February. Germany's Composite PMI also returned to growth for the first time since March, rising to 51.3 in July from 49.5 in June. However, Germany's Services PMI edged up to 49.8 from 48.6, still below the neutral 50.0 threshold but representing the mildest decline since April [1].
On the Japanese side, the Yen received support from domestic policy moves and Bank of Japan (BoJ) guidance. TD Securities noted that the JPY was in need of near-term domestic policy support, which arrived swiftly with Ministry of Finance (MoF) intervention and hawkish forward guidance from the July BoJ meeting. Japanese Chief Cabinet Secretary Minoru Kihara emphasized that monetary policy decisions remain strictly within the BoJ's purview and refrained from commenting on recent remarks by US Treasury Secretary Scott Bessent or reports about Prime Minister Takaichi's request to BoJ Governor Kazuo Ueda regarding Japanese government bond purchases [1].
Meanwhile, the USD/CHF pair reversed a modest intraday dip and touched a fresh daily high during the early European session on Wednesday, though it remained below the 0.8100 mark. The US Dollar (USD) maintained a negative bias amid hopes for a US-Iran deal and receding Federal Reserve (Fed) rate-hike expectations, acting as a headwind for USD/CHF. Traders are awaiting the US Nonfarm Payrolls (NFP) report on Friday and developments in the Middle East for further cues. Technically, spot prices hold above the 23.6% Fibonacci level of the recent pullback from the year-to-date high above 0.8200 set in July. The MACD has turned marginally positive around the zero line, and the RSI near 52 hints at modest bullish momentum. Upside attempts are constrained by resistance near the 0.8100 confluence, with further barriers at 0.8121, 0.8141, 0.8169, and 0.8205. Immediate support is seen at 0.8077, with a break exposing the cycle low region around 0.8037 [2].
Currency heat maps show that the Euro was the strongest against the New Zealand Dollar, with a 0.51% gain, and also posted gains against the JPY (+0.11%) and CHF (+0.09%). The US Dollar was strongest against the New Zealand Dollar (+0.47%) and posted a 0.02% gain against the JPY, but was down 0.04% against the EUR and 0.06% against the CHF [1][2].
CONCLUSION
The Euro's rise against the Yen was driven by robust PMI data from Germany and the Eurozone, signaling renewed business activity and supporting EUR strength. The Yen found support from domestic policy actions and BoJ guidance, while the USD showed mixed performance amid cautious sentiment ahead of key US jobs data and geopolitical developments. Overall, the market impact is medium, with traders closely watching upcoming economic releases for further direction.