- GBP/JPY holds onto recovery gains from 137.43 amid a quiet session.
- UK’s BRC Like-For-Like Retail Sales flashed upbeat signs, Japan’s Labor Cash Earnings fall below expectations and prior.
- Coronavirus-led deaths in the UK drop to pre-lockdown levels, UK PM Boris Johnson’s spokesman signals early reopen of non-essential retail.
- Britain and Japan to start negotiating a landmark trade deal on Tuesday.
GBP/JPY prints 0.13% intraday gains while taking the bids near 138.15 amid the few minutes of the Tokyo session on Tuesday. The pair recently benefited from the second-tier data from the UK and Japan, which in turn helped the quote to recover after stepping back from the highest since February 28 the previous day.
UK’s BRC Like-For-Like Retail Sales gained more than 5.7% in April to 7.9% in May. On the other hand, Japan’s Labor Cash Earnings dropped below a +0.6% forecast to -0.6% in April.
Other than the data, the lowest coronavirus (COVID-19) deaths in Britain since March as well as the Tory government’s rush to reopen also favor the pair buyers. The UK’s daily total deaths due to the virus dropped to 22 during the weekend, which in turn helped the Health Secretary Matt Hancock to say that the coronavirus is “in retreat across the country”.
Elsewhere, UK PM Johnson’s spokesperson said that it is our intention to reopen non-essential retail from June 15 but it is clear such reopening is conditional.
Also helping the pair could be the UK-Japan trade negotiations that are to start from Tuesday. Britain will discuss a post-Brexit trade deal with Japan on Tuesday and embarks it will ‘go further’ than the EU-Tokyo pact, per the UK Express.
It’s worth mentioning that the market’s risk-tone stays under pressure after the previous day’s optimism. While portraying the same, the US 10-year Treasury yields drop two basis points to 0.864% whereas Japan’s NIKKEI declines 0.50% to 23,066 by the time of writing.
Looking forward, a lack of major data could keep the traders directed towards qualitative catalysts for fresh impetus. However, Japan’s preliminary readings of Machine Tool Orders for May, prior -48.3%, could offer intermediate moves to the pair.
Technical analysis
Unless providing a daily closing below a 200-day SMA level of 137.57, bulls are less likely to avoid targeting 140.00 rouns-figure.
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