Ella 
EUR/JPY regained some ground around 167.20 during early European trade on Tuesday. The Japanese yen (JPY) extended losses for a second straight day, providing some support for the cross. On Tuesday, traders will focus on second-quarter gross domestic product (GDP) data from the euro zone and Germany. On Wednesday, all eyes will be on the Bank of Japan (BoJ) policy meeting.
Last week’s weak German IFO survey results and weaker euro zone economic data heightened speculation that the European Central Bank (ECB) would cut interest rates again. European Central Bank President Christine Lagarde emphasized at a recent press conference that the central bank will continue to adopt a data-dependent approach, and a rate cut in September is still not certain.
Traders will get more clues from euro zone and German gross domestic product data later in the day, which could provide key information for the European Central Bank as officials look for signals on whether to resume rate cuts in September. . Germany’s second-quarter GDP is expected to grow by 0.1% quarter-on-quarter, and the euro zone’s second-quarter GDP is expected to grow by 0.2% from the previous quarter. If the reading is stronger than expected, this could boost EUR/JPY.
On the other hand, growing speculation that the Bank of Japan will raise interest rates on Wednesday could boost the yen and limit the upside for the cross. A Reuters poll of economists expects the Bank of Japan to raise interest rates by 10 basis points to 0.1% at its upcoming July meeting.
Elsewhere, Japan’s unemployment rate fell to 2.5% in June from 2.6% in May, data from the Statistics Bureau showed. The reading was the first improvement in five months and topped consensus expectations of 2.6%.
