XE Market Analysis: Europe – May 18, 2018

The yen have traded softer into the London interbank open, which saw USD-JPY touch 111.00 for the first time since January while concurrently lifting yen crosses. AUD-JPY, for instance, clocked a one-month high. A dip in Japanese inflation data weighed on the yen. Headline April CPI fell to a rate of 0.6% y/y from 1.1% y/y in March, while core CPI ebbed to 0.7% y/y from 0.9% y/y. The outcomes undershot market expectations, and should maintain the BoJ’s ultra-accommodative monetary policy. EUR-USD, meanwhile, lifted back above 1.1800, though remain well off yesterday’s high at 1.1837.