GBP/JPY shrugs off latest trade/political headlines while heading into the key day

0
  • GBP/JPY shows little reaction to Brexit, US-Japan trade headlines.
  • DUP’s leader met Irish PM, German FM support a Brexit with the deal while Japanese Foreign Minister conveys requirements of the US-Japan trade deal.
  • BOJ, UK Retail Sales and BOE together offer a crucial day for the pair traders.

GBP/JPY stays modestly changed to 135.25 while showing little reaction to the latest Brexit/trade headlines during Thursday’s Asian session.

As per the latest news, Democratic Unionist Party (DUP) leader Arlene Foster recently signaled a willingness to accept a bespoke solution to the Irish border issue, a stark change over her previous objection. She met the Irish Prime Minister (PM) Leo Varadkar and details of the same are still awaited, indicating likely good news for the UK PM Boris Johnson. Further, Germany’s Finance Minister Olaf Scholz recently crossed wires while saying that a no-deal Brexit would not be good. Moreover, The Guardian reports that the UK PM Johnson is given a two week’s deadline to present their proposal for Irish border by the European Union (EU) leaders after they announced readiness to offer another Brexit extension if Britain demands and has a plan for it.

Concerning the Japanese Yen (JPY) was news conveying the Japanese Foreign Minister’s comments that the nation wants confirmation from the US relating to no new levies on autos before signing a trade deal around September 25. Also, firm US support to Saudi Arabia, as indicated by the US Secretary of State Mike Pompeo’s comments, grabbed the headlines off-late.

The pair surged to a fresh eight-week high on Wednesday after the Fed’s dubious rate cut added to the quote’s initial run-up based on Brexit-positive headlines. It should also be noted that the United Kingdom’s (UK) weaker than anticipated Consumer Price Index (CPI) details for August had little impact on the buyers’ outlook.

Investors will now look forward to the monetary policy meeting by the Bank of Japan (BOJ) wherein the Japanese central bank isn’t expected to alter present monetary policy while leaving doors open for further action if needed. The Bank of England (BOE) is also anticipated to follow the suit with no likely change to the current monetary policy. On the other hand, the UK Retail Sales for August might signal worries for the British Pound (GBP) buyers if matching downbeat forecasts.

Technical Analysis

The quote needs a successful break above 135.20 to aim for 136.30 and July month top surrounding 137.80 failing to do so can recall 100-day simple moving average (DMA) level of 135.00 while a downside break below the same opens the door for fresh declines to July 18 low near 133.85.

Get the 5 most predictable currency pairs

About Author

Comments are closed.