• EUR/JPY edges lower to 159.60 amid the BoJ’s hawkish tilt and safe-haven flows.
• Investors anticipate the ECB to embark on the first rate cut at the June meeting.
• BoJ policymakers hinted about the monetary policy shift, which lifts the Japanese Yen. 
• The Eurozone Retail Sales will be released later on Tuesday. 

The EUR/JPY cross extends its downside above the mid-159.00s during the early European session on Tuesday. Investors await the December Eurozone Retail Sales for fresh catalysts. Meanwhile, the hawkish tilt from the Bank of Japan (BoJ) and ongoing geopolitical tensions in the Middle East might boost the safe-haven Japanese Yen (JPY) against the Euro (EUR). The cross currently trades near 159.60, losing 0.05% on the day.  

On Monday, Germany’s Trade Balance rose to €22.2 billion in December from the previous reading of €20.7 billion. German Imports fell 6.7% in the same period versus a 1.5% rise prior and the exports dropped 4.6% in December from a 3.5% rise in November. Furthermore, Germany’s HCOB Composite Purchasing Manager’s Index (PMI) came in at 47.0 versus the expectation and the previous reading of 47.1. Investors continue to expect the ECB to embark on the first rate cut at the June meeting. However, incoming data such as inflation and wage growth will confirm an inflation path of 2%.