GBP/JPY stabilizes below 213.00 after suspected JPY intervention-led intraday volatility
- GBP/JPY attracts heavy intraday selling on Monday amid suspected Yen intervention.
- Economic concerns stemming from Middle East tensions cap the upside for the JPY.
- The BoE’s hawkish outlook lends support to the GBP and also limits losses for the cross.
The GBP/JPY cross seems to have stabilized following good two-way price swings earlier this Monday and trades just below the 213.00 mark during the first half of the European session.
The Japanese Yen (JPY) gets a strong boost at the start of a new week amid speculations that authorities again intervened in the FX market to prop up the weak domestic currency. This, in turn, was seen as a key factor behind the GBP/JPY pair's intraday decline of nearly 200 pips from levels just above mid-216.00s. However, economic concerns stemming from the Middle East crisis and the continued disruption of energy supplies through the Strait of Hormuz hold back the JPY bulls from placing aggressive bets.
Meanwhile, US President Donald Trump announced a new initiative to guide ships stranded in the Gulf under a program called "Project Freedom". The immediate market reaction, however, remains muted as top Iranian lawmaker Ebrahim Azizi said that any US interference in the strategic waterway will be considered a violation of the ceasefire. This, along with the lack of progress in US-Iran peace talks, keeps geopolitical risks in play and remains supportive of elevated Crude Oil prices, capping gains for the JPY.
The British Pound (GBP), on the other hand, draws support from the Bank of England's (BoE) hawkish outlook, suggesting that rate hikes could be appropriate if inflation remains persistent. This turns out to be another factor that contributes to limiting the downside for the GBP/JPY cross. From a technical perspective, the intraday fall stalled near the 100-day Simple Moving Average (SMA), further warranting caution before positioning for an extension of last week's sharp pullback from the highest level since January 2008.
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 British Pound.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | -0.01% | 0.11% | -0.08% | 0.10% | 0.08% | -0.01% | 0.13% | |
| EUR | 0.00% | 0.08% | -0.07% | 0.10% | 0.10% | -0.00% | 0.12% | |
| GBP | -0.11% | -0.08% | -0.17% | 0.01% | 0.02% | -0.09% | 0.06% | |
| JPY | 0.08% | 0.07% | 0.17% | 0.14% | 0.10% | 0.01% | 0.14% | |
| CAD | -0.10% | -0.10% | -0.01% | -0.14% | -0.04% | -0.14% | 0.03% | |
| AUD | -0.08% | -0.10% | -0.02% | -0.10% | 0.04% | -0.13% | 0.04% | |
| NZD | 0.00% | 0.00% | 0.09% | -0.01% | 0.14% | 0.13% | 0.15% | |
| CHF | -0.13% | -0.12% | -0.06% | -0.14% | -0.03% | -0.04% | -0.15% |
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.
