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...

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 Japanese yen continues to weaken amidst quiet trade to start the week...

The market is likely to keep pushing the yen lower in the coming days and weeks until the BOJ takes decisive action to stem the bleeding.

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.

As pressure mounts on BoJ to control yields, will we see a surprise policy response or perhaps government intervention?

Of course, we’ll have to find out if yesterday’s sell off really is ‘oversold’, but the overnight rise for index futures and commodity FX appear to be corrective in nature.

More of the same with the Fed as Jerome Powell is confirmed for a second term. The yen rallied on geopolitical concerns as Russia threatened Finland over joining NATO.

With BOJ monetary policy diverging from that of the Fed and the BOE, USD/JPY and GBP/JPY have been on a tear lately.