Bullish
🤖 75%
Goldman Sachs Says G10 Carry Trade Environment Best in Over 20 Years
While the euro offers moderate yields, the ECB's hold vs the BOJ's dovish stance still creates a carry advantage, and the broad G10 carry trade backdrop could lift EUR/JPY.
Catalysts
- ▲ ECB rate hold vs BOJ dovishness
- ▲ Eurozone economic recovery improving carry appeal
Risk Factors
- ▼ ECB rate cuts narrowing differentials
- ▼ Risk-off shocks boosting the yen
▼ Show FAQ (3) ▲ Hide FAQ
Is EUR/JPY a classic carry trade pair?
While not as high-yielding as AUD or NZD, the euro still offers a positive carry over the yen, especially with the ECB maintaining rates while the BOJ remains ultra-loose.
What could limit EUR/JPY upside in this environment?
If the European Central Bank cuts rates sooner than expected or if political risks in the Eurozone resurface, the carry advantage would diminish.
How does Goldman's carry trade view impact EUR/JPY?
Goldman's upbeat assessment of G10 carry opportunities indirectly supports EUR/JPY by highlighting the broad appeal of yen-funded positions, though EUR's lower yield caps the impact relative to commodity currencies.