EUR/JPY remains stronger near 184.50 following Tokyo inflation data

EUR/JPY strengthened to around 184.40 in Asian hours after recovering from a 1.88% drop the prior day, as a softer yen followed mixed Tokyo inflation data and reports of suspected Tokyo intervention. Tokyo’s headline CPI rose 1.5% YoY in April while core measures (ex-fresh food and ex-fresh food & energy) softened to 1.5%, missing forecasts, weighing on JPY. Market participants attributed a sharp yen move to unconfirmed government intervention after officials warned against excessive selling, and are now pricing the chance of further action. The euro also found support after the ECB left rates unchanged at a 2% deposit rate, while the US dollar index traded weak near 98.00.