GBP/JPY jumps above 148.00 to highest since December after BoE
|The pound is rising sharply on Thursday boosted by Bank of England decision to kept rates unchanged, the minutes and more recently by comments from Governor Carney regarding a “modest adjustment in interest rates”.
GBP/JPY jumped after the BoE rate decision from 145.90 toward 148.00. During the American session the pair continued to rise and at the moment is trading at 148.20/25, the highest level since December 2016.
The bullish momentum of the pound remains strong with market participants pricing in, a sooner than previously expected, rate hike. The BoE kept rates unchanged by a 7-2 vote. The tone of the message was seen as “hawkish” after the central bank mentioned that rates could rise sooner than what the market was anticipating. Recent comments from Carney opened the door to a rate hike in the short-term.
Bank of England sends hawkish signal to markets - Danske Bank
GBP/JPY outlook
The pair is breaking a key technical level located around 148.00. That area has been offering resistance since December of last year. A consolidation around current levels could open the doors for medium-term extension of the upside. The next resistance levels could be seen at 150.00 (psychological) and 151.60/70 (Apr 2016 low).
On the flip side, support now might lie at 147.55/60 (US session low), 146.65 (Sep 13 high) and 145.60 (Sep 13 low).
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