The EUR/JPY pair has been drawing buyers for the fourth consecutive day, continuing its recovery from the 159.65 level, where last week's monthly low was recorded.

However, rising expectations for a Bank of Japan rate hike on Friday may limit significant yen depreciation.The modest strengthening of the U.S. dollar and Trump's threats to impose tariffs on the European Union, coupled with expectations that the European Central Bank (ECB) may further lower borrowing costs, also put pressure on the euro and could constrain further gains for EUR/JPY.

Given the fundamental backdrop and recent struggles near the 200-day Simple Moving Average (SMA), traders looking to bet on further pair growth should proceed with caution. It is advisable to wait for sustained buying momentum before entering long positions. Later today, speeches by ECB President Christine Lagarde may provide additional market drivers, though the key focus will remain on the pivotal monetary policy meeting of the Bank of Japan.

From a technical perspective, the Relative Strength Index (RSI) on the daily chart is starting to gain positive momentum, suggesting that further pair growth could be on the horizon.

The yen has been strongest against the New Zealand dollar.