The euro is strong today and one reason is buying via EUR/JPY as that pair climbs above last week's highs to make fresh 15-year highs.
The monthly chart is a compelling case of momentum and is backed by widening interest rate differentials. I expect repeated bouts of angst regarding the possibility that the Bank of Japan abandons yield curve control but there were no hints of change at the latest BOJ meeting.
Some of the gains today relate to European inflation fears after UK core CPI was at 7.1% y/y today compared to 6.8% expected. I'd suspect that soft industry in Europe and higher unemployment should provide strong pushback against that thinking but no one should rule out more energy problems this winter. The Bank of England decision on Thursday will be critical for both GBP and EUR.
Also don't rule out the signal from Thursday's SNB decision with a hike to 1.75% from 1.50% likely.
