The GBP/JPY pair starts the new week on a weaker note and erodes part of the strong gains made on Friday to reach a new high since August 2008 – levels just above the 211.00 level. However, the downtrend lacks bearish conviction, with spot prices rebounding a few pips from the low during the Asian session and currently trading around the 210.80-210.75 area, down less than 0.10% on the day.
Against the backdrop of ongoing geopolitical uncertainty resulting from the protracted war between Russia and Ukraine, concerns about renewed conflict between Israel and Iran, and escalating tensions between the United States and Venezuela, are boosting demand for traditional safe-haven assets. This, coupled with speculation that Japanese authorities will intervene to stem further weakness in the local currency, is benefiting the Japanese Yen (JPY), which in turn is seen as a major factor weighing on the GBP/JPY pair.
Meanwhile, the Bank of Japan (BoJ) left the door open for further tightening after raising interest rates to a 30-year high on Friday, although it offered little clues about the future policy path. Moreover, concerns about Japan’s deteriorating financial situation, exacerbated by the sharp rise in Japanese government bond yields, are preventing JPY bulls from placing aggressive bets. Apart from this, the hawkish bias of the Bank of England (BoE) is supporting the British Pound (GBP) and the GBP/JPY pair.
As expected, the Bank of England’s Monetary Policy Committee voted 5 to 4 in favor of a 25 basis point cut to 3.75%. However, the close split in votes revealed differences within the committee, especially after the recent inflation surprise. This in turn forced investors to reduce their expectations for more aggressive easing next year. Furthermore, the emergence of some USD selling is acting as a tailwind for the GBP and calls for caution before entering into trades for deeper GBP/JPY losses.
Traders are now looking to the release of the final third quarter GDP reading in the UK to gain some momentum amid relatively weak trading volumes on the back of the end-of-year holiday season. However, the above fundamental backdrop makes it wise to wait for a strong sell-off before confirming that the GBP/JPY pair has formed a near-term top around the 211.00 level.
Japanese yen price today
The table below shows how much the Japanese Yen (JPY) has changed against the major currencies listed today. The Japanese yen was the strongest against the US dollar.
| US dollars | euro | GBP | JPY | Canadian | Australian dollar | New Zealand dollar | Swiss franc | |
|---|---|---|---|---|---|---|---|---|
| US dollars | -0.08% | -0.19% | -0.22% | -0.05% | -0.25% | -0.18% | -0.10% | |
| euro | 0.08% | -0.10% | -0.15% | 0.03% | -0.17% | -0.12% | -0.02% | |
| GBP | 0.19% | 0.10% | -0.04% | 0.14% | -0.06% | -0.01% | 0.09% | |
| JPY | 0.22% | 0.15% | 0.04% | 0.19% | -0.02% | 0.03% | 0.13% | |
| Canadian | 0.05% | -0.03% | -0.14% | -0.19% | -0.20% | -0.17% | -0.05% | |
| Australian dollar | 0.25% | 0.17% | 0.06% | 0.02% | 0.20% | 0.05% | 0.15% | |
| New Zealand dollar | 0.18% | 0.12% | 0.01% | -0.03% | 0.17% | -0.05% | 0.10% | |
| Swiss franc | 0.10% | 0.02% | -0.09% | -0.13% | 0.05% | -0.15% | -0.10% |
The heat map shows the percentage changes in major currencies versus each other. The base currency is chosen from the left column, while the counter currency is chosen from the top row. For example, if you select the Japanese Yen from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent the Japanese Yen (base)/US Dollar (quote).
