• EUR/JPY falls as stronger JPY follows Japanese Prime Minister Takaichi’s historic LDP landslide victory.
• The JPY gained support on speculation that Japanese authorities may intervene to curb excessive currency weakness.
• The Euro could gain support as the ECB stays on hold amid resilient growth.

EUR/JPY extends its losses for the third successive session, trading around 182.80 during the Asian hours on Wednesday. The currency cross remains subdued as the Japanese Yen (JPY) strengthens on optimism following Japanese Prime Minister Sanae Takaichi's lead of the ruling Liberal Democratic Party (LDP) to a historic landslide victory. Takaichi’s policy agenda may boost economic growth and provide the Bank of Japan with more room to raise interest rates.

The JPY also drew support from speculation that Japanese authorities may intervene to curb excessive currency weakness. Meanwhile, a softer US Dollar (USD), pressured by weaker US economic data that reinforced expectations of Federal Reserve rate cuts, further boosted the Yen.

The downside in EUR/JPY may be limited as the Euro (EUR) finds support from the European Central Bank (ECB), which has stayed on hold since ending its year-long easing cycle in June last year, with resilient growth reducing the need for further policy support.

Danske Bank analysts also point to the newly finalized EU–India trade agreement, which will eliminate tariffs on more than 90% of traded goods within seven years. Although India currently accounts for just 1.5% of the Euro area's exports, it is projected to grow around 6.5% annually through 2030. The agreement significantly reduces car tariffs from 110% to as low as 10% and removes duties on auto parts.