EUR/JPY

The EUR/JPY is the currency pair encompassing the European Union’s single currency, the euro (symbol €, code EUR), and the Japanese yen of Japan (symbol ¥, code JPY).

The pair’s rate indicates how many Japanese yen are needed in order to purchase one euro. For example, when the EUR/JPY is trading at 125.00, it means 1 euro is equivalent to 125 Japanese yen.

The euro (EUR) is the world’s second most traded currency, whilst the Japanese yen (JPY) is the world’s third most traded currency, resulting in an extremely liquid pair.

Why the EUR/JPY Remains an Attractive Option for Traders

Whilst the spreads of currency pairs vary from broker to broker, generally speaking the EUR/JPY often stays within the 1 pip to 3 pip spread range.

The EUR/JPY is one of a select few pairs which have a low spread yet decent daily range.

Important news announcements for this pair include the Consumer Price Index (CPI) for the Eurozone.

Releases such as these give an idea of changes in the price of goods and services, and the Jobless Rate for Japan, which measures the percentage of unemployed in the country.

For example, if this figure comes out as a lower percentage, it indicates strength in the Japanese economy, thereby pushing the EUR/JPY lower.

Out of all the JPY pairs, it is the EUR/JPY that is arguably the most attractive to the broad spectrum of traders, regardless of their method of trading.

Its low spread plus high volatility makes it a great candidate for both short- and long-term trading.

Compared to the USD/JPY, it has a higher spread but higher range, whereas compared to the GBP/JPY, it has a lower spread but also a lower range.

In this sense the EUR/JPY combines the best of both worlds, which explains part of its appeal