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  • Lack of progress in Brexit negotiations continues to cap upside in Sterling.  
  • S&P 500 futures are currently trading in the red. Risk-aversion will likely put a bid under JPY pushing GBP/JPY lower.  

GBP/JPY is again trading in the red in Asia, as Brexit uncertainty continues to overshadow upbeat UK data.  

The currency pair picked up a bid at lows near 146.61 yesterday, possibly due to upbeat UK services PMI release. The ensuing recovery rally, however, ran out of steam at highs above 147.40 after reports hit the wires that meeting between the EU’s Barnier and the Attorney General Cox is unlikely to produce a breakthrough deal.  

As per latest reports, talks are set to continue today and lack of progress will likely hurt Sterling. As of writing, GBP/JPY is down 0.26 percent on the day at 147.06.  

Apart from Brexit headlines, the JPY cross could also be weighed down by potential risk aversion in the stock markets. At press time, Asian stocks are trading mixed, while the S&P 500 futures are reporting a 0.16 percent drop. Meanwhile, futures on UK’s FTSE 100 are trading flat.

Technical Levels