EUR/JPY: Euro / Japanese yen

EUR/JPY is the price of one euro in Japanese yen. If the pair is at 160.00, one euro costs 160 yen. It is one of the most heavily traded crosses, linking the euro area with the world's fourth-largest economy, and it is driven by two things above all: the gap between European and Japanese interest rates, and the mood of global markets.

This profile covers who trades it, the central banks behind it, what tends to move it, how it behaves through the day, costs, a pip value example, correlations, notable history and the risks for beginners.

What EUR/JPY is and who trades it

EUR/JPY is a cross, a pair that does not include the US dollar; our guide to currency pairs explains crosses and how they are priced. The euro is the base currency and the yen the quote. A rising EUR/JPY means the euro is strengthening against the yen; a falling one means the yen is strengthening.

Participants range from European and Japanese exporters hedging trade flows, to Japanese investors buying euro-denominated bonds, to macro funds expressing views on interest rates and risk appetite. Because Japan has long had very low interest rates and a large pool of savings invested abroad, flows out of and back into the yen are a recurring theme.

Like most yen pairs, EUR/JPY is quoted to two decimal places, so a pip is 0.01 rather than 0.0001. For ESMA's retail leverage rules it counts as a major, because both the euro and the yen are on the list of USD, EUR, JPY, GBP, CAD and CHF, so EU retail clients can use up to 30:1.

The two economies and central banks behind it

The euro area and the ECB

The European Central Bank sets policy for the euro area at eight monetary policy meetings a year, with decisions at 14:15 CET (13:15 UK time) followed by a press conference. It targets 2% inflation over the medium term. The ECB's deposit rate was negative from 2014 until 2022, when it raised rates in response to high inflation.

Japan and the Bank of Japan

The Bank of Japan's Policy Board also meets eight times a year, usually over two days, with the decision released during the Tokyo day, which is the early morning in the UK. Japan spent decades with very low inflation and rates near zero. The BoJ introduced a negative short-term rate in 2016 and controlled long-term government bond yields from 2016, and it ended negative rates on 19 March 2024. Moves away from ultra-loose policy have been gradual, and markets watch every hint of the next step closely.

That history means EUR/JPY has spent long stretches as a pair where one side (the euro) offered a positive or at least higher rate and the other offered almost nothing. Our guide to central banks and interest rates explains why the expected path of rates matters more than the current level.

What typically moves EUR/JPY

The rate differential

When markets expect euro area rates to stay well above Japanese rates, holding euros and funding in yen pays, which has tended to support EUR/JPY. When the gap is expected to narrow, because the ECB is cutting or the BoJ is raising, that support weakens. The interest rate differential also sets the overnight swap.

Risk sentiment

The yen has a long-standing reputation as a safe haven: in sharp equity sell-offs or geopolitical shocks it has often strengthened, partly because Japanese investors bring money home and partly because carry trades funded in yen are closed. That means EUR/JPY has frequently fallen when global stock markets fall and risen in calm, risk-seeking periods. The link is a tendency, not a law; there have been periods when the yen weakened during stress, particularly when Japanese rates were far below everyone else's.

Carry trades

A carry trade means borrowing a low-yielding currency to hold a higher-yielding one, collecting the difference. EUR/JPY has been one of the vehicles for this, alongside AUD/JPY and GBP/JPY. Carry positions build slowly and can unwind fast, which is part of why yen crosses are known for sudden drops.

Intervention

Japan's Ministry of Finance decides on currency intervention and the Bank of Japan carries it out. Japan bought yen in September and October 2022 and again in 2024, when the yen had weakened rapidly. Those operations mostly targeted USD/JPY, but they moved every yen cross, including EUR/JPY, by a large amount in minutes. See our glossary entry on intervention.

Data

Euro area flash HICP and GDP, German data, Tokyo CPI (an early read on Japanese inflation), Japanese wage figures and the BoJ's quarterly outlook reports all feed rate expectations. As always, the surprise against consensus is what moves prices; see how economic data moves forex.

Its character: liquidity, sessions and volatility

EUR/JPY trades actively in two windows. Times below are UK time for most of the year; Japan does not use daylight saving, while the UK, euro area and US do, so the overlaps shift by an hour when clocks change.

• Tokyo session (roughly 00:00 to 09:00 UK time in winter, 01:00 to 10:00 during UK summer time): active for the yen side, especially around Japanese data and the Tokyo fixing early in the Japanese morning. The euro side is quieter.
• London session (about 07:00 to 17:00 UK time): usually the most liquid period for the pair, as European desks trade both currencies and the London and Tokyo sessions briefly overlap.
• London and New York overlap (about 13:00 to 17:00 UK time): active when US news moves risk sentiment.
• Late New York and the rollover (around 22:00 UK time): typically the quietest, with wider spreads.

Our market hours tool shows these sessions in your own time zone, and the market hours guide explains the daylight saving shifts.

EUR/JPY has generally been more volatile than EUR/USD and less volatile than GBP/JPY, and it is known for occasional sharp drops when risk appetite turns. Describe it to yourself as a pair that can trend for long periods and then reverse abruptly.

Costs of trading EUR/JPY

Spreads are usually a little wider than on EUR/USD or USD/JPY, and tend to widen outside the main sessions, around rollover and around BoJ or ECB announcements. Our guides to spreads and commissions and why spreads widen explain how to check typical rather than minimum spreads.

Swap matters more than on many pairs. Through most of the past decade euro rates were above Japanese rates, so long EUR/JPY positions have typically earned or paid less swap than short positions, but the broker's markup can turn a small positive into a charge, and the picture changes as the two central banks move. Read your platform's swap table and see swap and overnight financing.

Pip value: a worked example

On EUR/JPY a pip is 0.01 and gains and losses are earned in yen. These numbers are illustrative.

• One standard lot is 100,000 euros. A pip is 100,000 times 0.01 = 1,000 JPY.
• A mini lot is 100 JPY per pip; a micro lot is 10 JPY per pip.

To convert to your account currency, divide by the relevant yen rate. On a euro account with EUR/JPY at 160.00, 1,000 yen is 1,000 divided by 160, about 6.25 EUR per pip per standard lot. On a dollar account with USD/JPY at 150.00, it is about 6.67 USD.

Now a trade. You buy 0.3 lots (30,000 euros) at 160.00 with a stop at 159.20, 80 pips away. Each pip is worth 300 yen, so the stop is 24,000 yen, about 150 EUR at 160.00, before spread and swap. Notice that the pip value itself changes as EUR/JPY moves, because you are converting yen back into euros. Our pip value calculator handles that, and the position size calculator works backwards from your risk.

Margin at 30:1 on 30,000 euros would be about 1,000 EUR. That is not the most you can lose; on a gap the loss can exceed the stop distance. See leverage and margin.

Correlations with other pairs

• USD/JPY, GBP/JPY and AUD/JPY often move in the same direction as EUR/JPY, because the yen is the common factor. On risk-off days all the yen crosses tend to fall together.
• EUR/USD influences it too, since EUR/JPY is roughly EUR/USD multiplied by USD/JPY.
• Equity indices have often shown a positive relationship with yen crosses, reflecting the risk-sentiment link.

That means a long EUR/JPY and a long GBP/JPY are largely the same short-yen trade. Correlations shift over time, so check them over a recent period; our currency correlation guide shows how.

Notable history

The euro's arrival and the 2008 financial crisis

EUR/JPY began trading when the euro was launched in 1999. During the global financial crisis of 2008, as carry trades unwound and investors fled risk, EUR/JPY fell very heavily over a matter of months, one of the clearest examples of how yen crosses behave when risk appetite collapses.

Negative rates on both sides

For several years both the ECB (from 2014) and the BoJ (from 2016) ran negative policy rates. The pair's carry element faded, and it was driven more by relative growth and risk sentiment. As the ECB raised rates from 2022 while the BoJ stayed near zero, the gap re-opened.

Japanese intervention (2022 and 2024)

Japan's authorities bought yen on 22 September 2022 for the first time since 1998, and again in October 2022. In 2024 they intervened again, including at the end of April and start of May, after the yen had weakened rapidly. Each time, EUR/JPY dropped sharply alongside USD/JPY.

The August 2024 carry-trade unwind

After the Bank of Japan raised rates on 31 July 2024 and a weak US jobs report on 2 August, positions funded in yen were closed rapidly. On Monday 5 August 2024 the Nikkei 225 fell 12.4%, its worst day since 1987, and yen crosses including EUR/JPY dropped steeply in a short time before partly recovering. It showed how a crowded carry position can turn into a fast, one-way market.

Trading EUR/JPY as a beginner

• Respect the drops. Yen crosses can fall fast when risk sentiment turns. Size so that a move several times your usual stop would still be survivable; see position sizing and gap risk.
• Convert pips to money every time. A pip in yen is worth a different amount than a pip on EUR/USD, and the value drifts as the rate moves.
• Know the two calendars. ECB and BoJ decision dates, Tokyo CPI and euro area flash HICP are the key events. Use an economic calendar.
• Do not trade the swap. A positive swap can look attractive, but a few pips of adverse movement wipe out weeks of carry.
• Be honest about the odds. Most retail CFD accounts lose money, and leverage magnifies losses. Practise on a demo first if the pair is new to you.

Frequently asked questions

Why is the pip on EUR/JPY 0.01 rather than 0.0001?

Because the yen has a much lower unit value than the euro or dollar, yen pairs are quoted to two decimal places by convention. A pip is therefore the second decimal, 0.01.

Is EUR/JPY a major pair?

Traders call it a cross because it does not include the US dollar. ESMA's leverage rules count it as a major, because both currencies are on the list of USD, EUR, JPY, GBP, CAD and CHF, so the EU retail cap is 30:1.

Why does EUR/JPY often fall when stock markets fall?

The yen has tended to strengthen in periods of stress, partly because carry trades funded in yen are closed and partly because Japanese investors repatriate money. That pushes yen crosses lower. The relationship is common but not guaranteed.

When is EUR/JPY most active?

Usually during the London session, roughly 07:00 to 17:00 UK time, with yen-specific activity in the Tokyo morning. The late New York session and the rollover hour are usually the quietest.

Does the Bank of Japan intervene in EUR/JPY?

Interventions are decided by Japan's Ministry of Finance and carried out by the Bank of Japan, and have usually been aimed at USD/JPY. Because they change the value of the yen itself, EUR/JPY moves sharply too.