Japan-German relative manufacturing PMIs suggest EUR/JPY is way too high, Kit Juckes, Chief Global FX Strategist at Société Générale, reports.

EUR/JPY is simply in the wrong place 

“Perhaps the biggest contrast in manufacturing PMI trends, is between Germany and Japan. I’ve plotted the difference between the two, which is at its lowest level since the Japanese series started, against EUR/JPY, which is at its highest level since the financial crisis.” 

“CFTC data show a growing Yen short as well as a huge and growing Euro long, so the EUR/JPY pair may have lots of room to fall if it can find a catalyst to get the ball rolling.”