GBP JPY

The Japanese yen has finally found some much needed support this week. It is all to do with the falls in global bond yields, and the unwinding of carry trades. US yields slumped earlier this week after US CPI fell more than expected, cementing expectations that the Fed (and other central banks) will no longer raise rates further

The big story this week has been on the inflation front, with CPI in the US and UK both falling faster than expected, cementing expectations that the Fed and other central banks will no longer raise rates further. With a couple of other key US economic pointers also coming in weaker this week, such as industrial production and jobless claims data, as well as a sharp drop in oil prices, this has led to speculation that the Fed may start cutting rates sooner than expected in 2024

USD/JPY remains by far the most bullish of the major yen crosses...

It’s been a big week for global markets and it’s not over yet, with the Bank of Japan rate decision scheduled for later today.

With EUR/JPY and GBP/JPY testing critical support, price action over the next 30 hours will go a long way toward determining if the year-to-date trends extend or end from here...

Today’s latest data once again highlighted the growing threat of stagflation in Europe, with UK economic output and eurozone industrial production both falling more than expected. High levels of inflation and low growth, combined with downbeat business and consumer sentiment, and not to mention rising borrowing costs, all make for a tough economic climate for investors to navigate through.

The USD/JPY breakout has continued even after an intervention threat, but both EUR/JPY and GBP/JPY have shown stall in those bullish trends over the past month, raising questions of reversal potential.

The Japanese Yen jumped as gold prices gained and stocks pulled back, with markets preparing for tomorrow’s FOMC rate decision amidst an injection of fear from banking.

Thanks to another 10% CPI inflation print, interest rate expectations are on the rise again in the UK. This is putting upward pressure in the yield spread between the UK and Japanese government bonds, boosting the GBP/JPY outlook.

The GBP/JPY has been supported by a double dose of bullish factors this week.

UK’s labour market tightened and wage pressures grew further, fueling bets that inflation could stay higher for longer...

Yen's growing strength weighs on all JPY pairs.

Another day, another handle conquered for USD/JPY. And whilst it flirts with 149 traders are questioning if 150 is up next.

Another day, another handle conquered for USD/JPY. And whilst it flirts with 149 traders are questioning if 150 is up next.

With the BOE and the BOJ intervening over the last week, GBP/JPY has been extremely volatile, trading in a range from 164.44 down to 148.79 over that same timeframe.

The yen was the weakest currency overnight during a mild risk-on session, allowing GBP/JPY to tap 166 ahead of today’s UK data dump at 07:00 BST.