GBP/JPY climbs to 189.00 amid modest JPY weakness; upside potential seems limited
The post GBP/JPY climbs to 189.00 amid modest JPY weakness; upside potential seems limited appeared on BitcoinEthereumNews.com.
GBP/JPY rebounds after retesting a multi-month low at the start of a new week. The strong recovery is sponsored by the emergence of selling around the JPY. The divergent BoJ-BoE expectations might cap any further gains for the cross. The GBP/JPY cross stages a goodish intraday recovery from the 187.00 neighborhood, or its lowest level since September 2024 retested earlier this Monday and builds on its ascent through the first half of the European session. Spot prices advance to the 189.00 mark in the last hour and for now, seem to have snapped a three-day losing streak. US President Donald Trump’s fresh tariff threats revive fears that Japan would also be an eventual target of new US levies, which, in turn, undermines the Japanese Yen (JPY) and prompts some short-covering around the GBP/JPY cross. However, hawkish Bank of Japan (BoJ) expectations and concerns about a global trade war hold back bearish traders from placing aggressive bets around the safe-haven JPY. Kazuhiro Masaki, Director General of the BoJ’s monetary affairs department, said last Thursday that the central bank will continue to raise interest rates if underlying inflation accelerates toward its 2% target as projected. This comes on top of data showing that Japan’s inflation-adjusted real wages rose for the second straight month and backs the case for further tightening by the Japanese central bank. This marks a big divergent in comparison to the Bank of England’s (BoE) gloomy outlook, which, in turn, should contribute to capping the GBP/JPY cross. The UK central bank lowered its benchmark interest rate by 25 basis points last week and downgraded the growth forecast for 2025. Moreover, BoE Governor Andrew Bailey said that the central bank expects to make further rate cuts this year. In the absence of any relevant economic data, the aforementioned fundamental backdrop…
Filed under: News - @ February 10, 2025 9:21 am