GBP/JPY breaks below 193.00 ahead of BoE’s interest rate decision

GBP/JPY declines as the Japanese Yen strengthens, fueled by market expectations of a potential BoJ rate hike in 2025.
The UK ILO Unemployment Rate held steady at 4.4% for the three months ending January, as expected.
The BoE is expected to keep interest rates unchanged at 4.5% with a 7-2 vote split on Thursday.

Akhtar Faruqui FXStreet

GBP/JPY continues to slide for the second straight session, hovering around 192.80 during European trading hours on Thursday. The currency cross weakens as the Japanese Yen (JPY) gains traction, driven by market expectations of a potential Bank of Japan (BoJ) rate hike in 2025. On Wednesday, the BoJ kept its short-term interest rate target steady within the 0.40%-0.50% range.

The BoJ’s Monetary Policy Statement highlighted moderate economic recovery in Japan, despite some persistent weaknesses. Consumer spending is gradually improving, and inflation expectations are rising at a controlled pace. In a post-meeting press conference, BoJ Governor Kazuo Ueda reaffirmed that the central bank would adjust its policies to ensure the sustainable and stable achievement of its inflation targets.

Additionally, the GBP/JPY cross faces downward pressure as the Pound Sterling (GBP) weakens against major counterparts following the release of the UK labor market data. The Office for National Statistics (ONS) reported that the ILO Unemployment Rate remained at 4.4% for the three months ending January, in line with expectations and the previous reading.

UK Employment Change showed an increase of 144K new jobs during the same period, surpassing the 107K additions recorded in the three months ending December. Meanwhile, Average Earnings (excluding bonuses) rose by 5.9%, matching forecasts and previous figures.

Investors now turn their attention to the Bank of England’s (BoE) interest rate decision, expected later in the day. The BoE is widely anticipated to maintain rates at 4.5% with a 7-2 vote split. In its last policy meeting in February, the central bank lowered borrowing costs by 25 basis points.

Economic Indicator

BoE Interest Rate Decision

The Bank of England (BoE) announces its interest rate decision at the end of its eight scheduled meetings per year. If the BoE is hawkish about the inflationary outlook of the economy and raises interest rates it is usually bullish for the Pound Sterling (GBP). Likewise, if the BoE adopts a dovish view on the UK economy and keeps interest rates unchanged, or cuts them, it is seen as bearish for GBP.

EUR/USD sticks to positive bias above 1.1800 as trade jitters undermine USD

The EUR/USD pair builds on the previous day's modest gains and attracts some buyers for the second straight day on Thursday amid a softer US Dollar. Spot prices, however, lack bullish conviction and trade around the 1.1815-1.1820 area during the Asian session, up 0.10% for the day.

GBP/USD bounces as soft CPI boosts BoE cut bets

GBP/USD rose 0.42% on Wednesday, recovering toward 1.3600 in a session shaped by softer-than-expected UK inflation data and broad US Dollar weakness. The pair had been consolidating in a tight range between about 1.3450 and 1.3520 for the past few days following the sharp pullback from the late-January high near 1.3870, and Wednesday's move pushed price action back onto the high side of key moving averages.

Gold retains positive bias amid sustained safe-haven demand, softer USD

Gold attracts some buyers for the second straight day as trade jitters and geopolitical tensions ahead of the US-Iran nuclear talks underpin demand for safe-haven assets. Apart from this, a softer US Dollar further supports the bullion, though the underlying bullish sentiment could cap gains. Bulls might also opt to wait for acceptance above the $5,200 mark before positioning for any meaningful appreciating move.

AUD/USD rises toward three-year highs on RBA rate hike bets

AUD/USD remains stronger for the third successive session, trading around 0.7120 during the Asian hours on Thursday. The pair advances toward its three-year high of 0.7147, last touched on February 12, as the Australian Dollar strengthens following hotter-than-expected inflation data from Australia, reinforcing expectations of further interest rate hikes by the Reserve Bank of Australia this year.

Nvidia delivers another monster earnings report, and forecasts big things to come

It was another monster earnings report from Nvidia for fiscal Q4. Revenues were $68.1bn, smashing estimates of $65bn. Gross profit margin was a healthy 75%, up from 73.5% in the prior quarter, and the outlook for this quarter was monstrous.

Cosmos Hub Price Forecast: ATOM rebounds slightly, bearish outlook remains intact

Cosmos Hub (ATOM) price rebounds, trading above $2.05 at the time of writing on Wednesday, after undergoing a sharp correction since last week. Weakening on-chain and derivatives data support a bearish outlook, while technical analysis remains unfavorable.