EUR/JPY Interest Rate Differential

The current policy-rate gap between Euro and Japanese Yen, and which side of EUR/JPY earns the carry. Updated daily · as of June 18, 2026.

EUR − JPY differential
+1.25 pp
EUR
2.25%
Euro
JPY
1.00%
Japanese Yen

Euro carries the higher policy rate, so going long EUR/JPY earns positive carry (swap); the opposite side pays it.

This is the current gap. The market trades the expected differential, which can move EUR/JPY before any rate change lands.

Go deeper

All interest rate differentials

The full matrix and carry calculator for every major.

The Carry Trade

How the differential becomes a daily swap, and why it crashes.

Euro rate decision

The schedule and results that move the EUR leg.

Japanese Yen rate decision

The schedule and results that move the JPY leg.

EUR/JPY carry — frequently asked

What is the EUR/JPY interest rate differential?

The EUR/JPY interest rate differential is currently +1.25 pp — the Euro policy rate (2.25%) minus the Japanese Yen policy rate (1.00%). Euro carries the higher rate, so it tends to attract demand.

Does long EUR/JPY earn or pay swap (carry)?

Going long EUR/JPY earns positive carry, paid as the daily swap (rollover), because that side holds the higher-yielding currency (Euro). The opposite side pays the swap. Carry is simply the interest-rate differential turned into a daily cash flow.

Why does the expected EUR/JPY differential matter more than today's?

Markets price the future, not the present. EUR/JPY can move on a widening or narrowing expected differential before any actual rate change, as new data and central-bank guidance shift the expected paths of the Euro and Japanese Yen central banks. Today's gap is largely already priced in.

Does the higher-yielding side of EUR/JPY always go up?

No. The rate differential is gravity, not a guarantee. It dominates in calm, risk-on conditions, but in a risk-off shock capital rushes to safe havens regardless of yield, and crowded carry positions can unwind violently.