- A bearish Sterling continues to sink against the safe-haven Yen.
- Late Thursday’s CPI reading for Japan will be the next focus for Yen-based pairs.
The GBP/JPY is catching a bounce at the tail end of Asia trading, lifting back into 110.20 after declining into 110.96 through the overnight session.
Risk aversion continued to be the overall theme governing the Guppy on Wednesday, with the Sterling sinking further against the Yen after the Bank of England’s Mark Carney and Financial Stability Report (FSR) double-header did little to drive buyers into the markets, with Carney focused on drags on global growth from the ongoing trade tensions between the US and almost everybody else, and the FSR highlighting potential risks from a disorderly Brexit, an outcome that continues to look increasingly likely to occur as current negotiations about the various Brexit concerns continue to go nowhere.
The Sterling sees little on the economic calendar for Thursday, though the BoE’s Haldane will be delivering a speech at 13:30 GMT which is expected to be a mid-tier occurrence. On the JPY side, late Thursday sees the Tokyo CPI indicator at 23:50 GMT, and the y/y/ core CPI figure for Tokyo, a bellwether indicator for national inflation readings in several weeks’ time, is expected to come in at 0.6%, a minor uptick from the previous reading of 0.5%.
GBP/JPY Levels to watch
Thursday’s early sell-off saw a new June low for the GBP/JPY below 144.20, and the next immediate barrier will be May’s low, nearby at 143.20, while a bullish correction will see resistance at last week’s swing high of 146.65, with further resistance at June’s high of 148.10.
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