GBP/JPY sees mild recovery around 160.30 despite strong Japan PMI numbers
|- GBP/JPY has recovered a little after slipping to near 160.30 on higher Japan PMI.
- The BOE is expected to elevate its interest rate by a significant figure to fix the inflation mess.
- In the European session, UK’s PMI numbers will remain in focus.
The GBP/JPY pair has attracted some bids in the early Asian session after slipping to near 160.30 on higher-than-expected Jibun Bank Japan’s Manufacturing and Services PMI numbers. The Jibun Bank Manufacturing and Services PMI have landed at 53.2 and 51.7 against the prior print of 52 and 50.6 respectively. The cross witnessed a decent sell-off at open after failing to cross Monday’s highest traded price at 161.02.
The pair has remained in the grip of the bulls since last week as the improved risk appetite of the market participants underpinned the risk-perceived currencies against the safe-assets.
The bound bulls are also getting traction on expectations of a rate hike by the Bank of England (BOE) in June. The BOE is left with no other alternative than to elevate its interest rates in the June monetary policy meeting. The Consumer Price Index (CPI) in the UK area has climbed to 9%, which cannot be overlooked and needed to be contained as early as possible. The households in the pound area are facing the heat of advancing energy bills and food prices. In order to tame the galloping inflation, a jumbo rate hike announcement is expected from the BOE.
Going forward, investors will focus on the Purchase Managers Index (PMI) numbers from the UK and Japan. The UK’s S&P Global/CIPS Manufacturing and Services PMI are seen at 55.1 and 57.3, lower than the previously recorded figures of 55.8 and 58.9 respectively.
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