• EUR/JPY edges lower to 157.20 in Wednesday’s early European session, down 0.72% on the day. 
• Japan’s trade balance shrank less than expected in August, but  Imports and Exports were worse than estimated. 
• Market players will keep an eye on the Eurozone HICP inflation data on Wednesday. 

The EUR/JPY cross weakens near 157.20, snapping to a two-day winning streak during the early European session on Wednesday. The Japanese weaker Imports and Exports reading raises some doubts over demand in Japan on the back of strong wages, which weighs on the Japanese Yen (JPY). The Bank of Japan (BoC) interest rate decision on Friday will be closely watched.

Japan’s Trade Balance shrank less than expected in August, although Imports and Exports missed estimations. Japan’s trade deficit widens to 695.3 billion yen in August from 628.7 billion yen in July, better than expectations for a deficit of 1.38 trillion yen. Meanwhile, Exports grew 5.6% YoY in August versus 10.2% prior, weaker than the 10.0% expected. Imports rose 2.3% in the same period from a 16.6% jump in July, below the consensus of a 13.4% rise.