Euro Rises Before Euro Zone Data, Yen Lower after BOJ

On Tuesday,  The euro pushed higher  as investors awaited reports on growth and inflation in the euro area, while the yen slid lower after the Bank of Japan said it would be more flexible in its massive stimulus program.

EUR/USD was up 0.17% to 1.1725 by 03:36 AM ET (07:36 GMT), after rising 0.41% on Monday.

Euro zone GDP figures are expected to show that the annual rate of growth slowed slightly in the second quarter, while headline inflation is expected to have remained steady.

The euro was also higher against the yen, with EUR/JPY rising 0.38% to 130.49.

The BOJ pledged to keep interest rates very low for the time being after its latest policy meeting overnight. It also made small adjustments to its asset purchase program to make it more flexible, rather than more drastic moves that some market participants had anticipated.

The monetary policy changes reflected the BOJ’s forecast that it would take more time for inflation to reach its 2% target.

Against the dollar, the yen was lower, with USD/JPY last at 111.27, up 0.2% for the day after reaching an overnight high of 111.45.

The U.S. dollar index, which measures the greenback’s strength against a basket of six major currencies, edged down 0.07% to 94.09, off Friday’s one-week high of 94.7.

Market participants were looking ahead to the conclusion of the Federal Reserve’s two-day policy meeting on Wednesday, where it will probably flag up its third rate hike this year in September.

The pound was a touch higher against the dollar, with GBP/USD inching up 0.08% to 1.3142, but eased against the euro, with EUR/GBP up 0.11% to 0.8923.

The Australian dollar was higher, with AUD/USD climbing 0.28% to 0.7428, while the New Zealand dollar was flat for the day, with NZD/USD last at 0.6823./

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