British Pound trades weak near mid-214.00s vs Japanese Yen amid intervention fears
- GBP/JPY extends its retracement slide from over a one-month top for the second straight day.
- Intervention fears prompt some short-covering around the JPY, exerting pressure on the cross.
- An intraday breakdown below the 100-hour SMA backs the case for a further depreciating move.
The GBP/JPY cross attracts sellers for the second straight day on Thursday and slides back closer to the lower boundary of the weekly range, though it lacks follow-through. Spot prices remain depressed through the first half of the European session and currently trade near mid-214.00s, down nearly 0.15% for the day.
As the USD/JPY pair hovers near the critical 160.00 threshold, traders are on high alert amid speculations that authorities will step in again to prop up the Japanese Yen (JPY). This, in turn, is seen as a key factor exerting some downward pressure on the GBP/JPY cross. The JPY bulls, however, seem hesitant and refrain from placing aggressive bets amid worries that Japan's economy will remain under strain due to the Middle East conflict and the continued disruption of supplies through the Strait of Hormuz.
The British Pound (GBP), on the other hand, benefits from a softer US Dollar (USD), weighed down by the Israel-Lebanon truce, and further helps limit the downside for the GBP/JPY cross. Meanwhile, traders have been dialing back their expectations for more aggressive policy tightening by the Bank of England (BoE) and are now pricing in the possibility of only one 25-basis-point (bps) rate hike by the end of this year. This could cap any meaningful appreciating move for the GBP and the GBP/JPY cross.
Moreover, growing acceptance that the Bank of Japan (BoJ) will raise interest rates at its upcoming policy meeting on June 15-16 could offer some support to the JPY and weigh on the GBP/JPY cross. Even from a technical perspective, an intraday breakdown below the 100-hour Simple Moving Average (SMA) backs the case for an extension of the recent pullback from the 215.50 region, or over a one-month high touched earlier this week.
Japanese Yen Price Today
The table below shows the percentage change of Japanese Yen (JPY) against listed major currencies today. Japanese Yen was the strongest against the Canadian Dollar.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | -0.04% | -0.01% | -0.13% | 0.18% | -0.01% | 0.02% | -0.03% | |
| EUR | 0.04% | 0.03% | -0.06% | 0.22% | 0.00% | -0.03% | 0.02% | |
| GBP | 0.00% | -0.03% | -0.09% | 0.19% | -0.01% | -0.06% | -0.02% | |
| JPY | 0.13% | 0.06% | 0.09% | 0.29% | 0.10% | 0.04% | 0.09% | |
| CAD | -0.18% | -0.22% | -0.19% | -0.29% | -0.20% | -0.25% | -0.21% | |
| AUD | 0.01% | -0.01% | 0.01% | -0.10% | 0.20% | -0.03% | 0.01% | |
| NZD | -0.02% | 0.03% | 0.06% | -0.04% | 0.25% | 0.03% | 0.04% | |
| CHF | 0.03% | -0.02% | 0.02% | -0.09% | 0.21% | -0.01% | -0.04% |
The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick 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 JPY (base)/USD (quote).
Author
Haresh Menghani
FXStreet
Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.
