GBP/JPY falls below 196.50 as BoE eyes quarter basis point rate cut

GBP/JPY continues to struggle following the UK’s Halifax House Prices data.
The Bank of England is widely expected to deliver a 25 bps interest rate cut on Thursday.
Trump announced plans to impose an additional 15% tariff on all imports from Japan.

Akhtar Faruqui FXStreet

GBP/JPY depreciates after registering gains in the previous two successive sessions, trading around 196.30 during the European hours on Thursday. The currency cross remains subdued following the release of Halifax House Prices from the United Kingdom (UK). Traders await the Bank of England’s (BoE) interest rate decision due later in the day.

The UK’s Halifax House Prices climbed by 2.4% year-on-year in July, following the previous gain of 2.7%. The reading marked the softest annual increase since July 2024. Meanwhile, the monthly prices rose 0.4%, surpassing the expected 0.3% increase.

The Pound Sterling (GBP) struggles as the Bank of England (BoE) is poised to deliver a 25 bps interest rate cut in August. The median market forecasts expect the Monetary Policy Committee (MPC) to vote 7-to-3 in favor of a quarter-point trim, bringing the BoE’s main reference rate down to 4.0% from 4.25%. The BoE Monetary Policy Report will also be eyed to assess the prospects for UK inflation over the following two years.

The GBP/JPY cross depreciates as the Japanese Yen (JPY) advances despite renewed tariff concerns. The upside of the JPY could be limited as the US President Donald Trump said that he would impose an additional 15% tariff on all Japanese imports, as Asahi newspaper cited a White House official.

Traders remain uncertain over the Bank of Japan’s (BoJ) monetary policy outlook. Japan’s central bank decided to keep its interest rates unchanged. However, the BoJ raised its inflation forecast and highlighted the increasing downside risks from global trade tensions.

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.

AUD/USD eyes 0.7150 barrier nine-day EMA

AUD/USD inches higher after registering modest losses in the previous day, trading around 0.7130 during the Asian hours. The technical analysis of the daily chart indicates that the pair is moving sideways within the rectangle pattern, suggesting a consolidation as neither the bulls nor the bears have enough momentum to take control of the market.

USD/JPY trades below 160.00 intervention threshold; bullish bias intact

The USD/JPY pair attracts some sellers during the Asian session amid fears that authorities will step in again to prop up the Japanese Yen. Furthermore, the Israel-Lebanon truce prompts some profit-taking around the US Dollar and exerts downward pressure on the currency pair.

Gold rebounds from one-week low as Israel-Lebanon truce pressures safe-haven USD

Gold gains some positive traction on Thursday and climbs to the $4,475 area during the Asian session, reversing a major part of the previous day's slide to a one-week low. The Israel-Lebanon truce prompts some profit-taking around the US Dollar and supports the commodity.

Hyperliquid: ETF demand, capital rotation fuel HYPE rally as Bitcoin melts

Hyperliquid price sustains an upward trend near its all-time high of $75.76 on Thursday after posting 80% gains in May, while Bitcoin (BTC) retraces below $65,000, triggering a market-wide panic.

Kevin Warsh takes the Fed helm: What it means for the US Dollar

The Federal Reserve moves away from the highly predictable "forward guidance" model of the Jerome Powell era to a new “Kevin Warsh environment”, characterized by less communication, more policy surprises, and an increased focus on the Fed's complex balance sheet.

Recession on paper: What really moves the Canadian Loonie now?

Statistics Canada handed the headline writers a gift and the analysts a headache. Real GDP shrank 0.1% on an annualized basis in the first quarter, and with the fourth quarter of 2025 revised down to a 1.0% contraction, that is two negative quarters in a row, the textbook definition of a technical recession and Canada's first since the pandemic.