EUR/JPY reversed sharply from its recent break above 150. Economists at ING expect the pair to decline toward 140 later this year. 

Late cycle woes favour EUR/JPY downside

“The tail-end of a business cycle is typically a difficult time for risk assets and 2023 should prove no exception. Looming recessions in both the US and the Eurozone will weigh heavily on global growth prospects and should demand some under-performance in this pro-cyclical EUR/JPY cross rate.”

“Despite still wide differentials between the eurozone and Japan, we favour a break to 140 later this year and 135 next year.”