- GBP/JPY extends Tuesday’s pullback from the highest level since November 2015, sluggish of late.
- Japan’s Jibun Bank PMIs improve for August, Treasury bond yields retreat from multi-year high.
- Market’s cautious optimism, consolidation ahead of the top-tier data prod pair traders.
- Fears of more pain for BoE and UK government exert downside pressure on prices ahead of British S&P Global/CIPS PMIs.
GBP/JPY holds lower grounds near 185.50 as it defends the previous day’s U-turn from the multi-year high after witnessing upbeat data from Japan, as well as a pullback in the Treasury bond yields, during the cautiously optimism markets on early Wednesday. However, the anxiety ahead of the August month Purchasing Managers Indexes (PMIs) for the UK prods the cross-currency pair’s further downside.
Japan’s first reading of the Jibun Bank Manufacturing PMI for August improves to 49.7 from 49.6, versus 49.5 expected, whereas the Services counterpart rose to 54.3 for the said month from 53.8 previous figures.
That said, the US 10-year Treasury bond yields keep the previous day’s retreat from the highest level since late 2007 to 4.31% by the press time whereas the yields of Japanese Government Bonds (JGBs) struggle around the levels last seen in 2014.
It’s worth noting that the market’s cautious optimism, backed by likely improvement in the US-China ties and the anticipated rally in the Nikkei 225, also weighs on the GBP/JPY prices. Furthermore, the UK government’s record transfer to the Bank of England (BoE) to cover the losses made by the Quantitative Easing (QE) joins a jump in the British public debt to 95% to also exert downside pressure on the quote.
However, Bank of Japan (BoJ) Governor Kazuo Ueda refrained from discussing the details of Tuesday’s meeting with Japan Prime Minister Fumio Kishida, which he termed a ‘routine’ one and keeps the Yen buyers hopeful. However, BoJ’s Kuroda did mention that he explained BoJ’s July policy decision to the PM.
Amid these plays, S&P500 Futures print mild gains and the stocks in the Asia-Pacific zone edged higher of late.
Moving on, the UK’s preliminary PMIs for August and geopolitical headlines will be crucial for fresh impulse. Above all, yield and this week’s Jackson Hole event are the key to a clear guide.
A daily closing below the two-week-old rising support line, now immediate resistance near 186.10, directs GBP/JPY bears toward July’s peak surrounding 184.00.
additional important levels
|Today last price||185.57|
|Today Daily Change||-0.18|
|Today Daily Change %||-0.10%|
|Today daily open||185.75|
|Previous Daily High||186.77|
|Previous Daily Low||185.54|
|Previous Weekly High||186.47|
|Previous Weekly Low||183.46|
|Previous Monthly High||184.02|
|Previous Monthly Low||176.32|
|Daily Fibonacci 38.2%||186.01|
|Daily Fibonacci 61.8%||186.3|
|Daily Pivot Point S1||185.27|
|Daily Pivot Point S2||184.78|
|Daily Pivot Point S3||184.03|
|Daily Pivot Point R1||186.5|
|Daily Pivot Point R2||187.26|
|Daily Pivot Point R3||187.74|
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.