EUR/JPY: the macro gap
On the Macro Currency Strength Meter, the Euro scores -37 and the Japanese Yen scores +25 — a gap of 62 points in favour of the Japanese Yen. The widest divergence is in interest rates, which favours the Japanese Yen. All else equal that gap is a fundamental tailwind for the Japanese Yen against the Euro — though markets may already have priced much of it in.
Strength gap
-62.0
Stronger side
JPY
Edge is
Widening
Scores
-37 vs +25
Factor by factor
Positive is stronger relative to the other majors, not in absolute terms. The gap column is EUR minus JPY.
| Factor | EUR | JPY | Gap |
|---|---|---|---|
| Interest Rates | -51 | +52 | -103.3 |
| Growth | — | +22 | -21.9 |
| Positioning | -43 | +46 | -89.8 |
| Risk Mood | -0 | -53 | +52.9 |
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