British Pound dips hold above 216.50 Japanese Yen following mixed UK data

The British Pound (GBP) against the Japanese Yen (JPY) experienced a limit at 217.00 earlier on Friday before retreating to the 216.50 range, where it found some support. The moderately positive UK business activity data, which included preliminary S&P Global Purchasing Managers Index (PMI) data for both services and manufacturing sectors, helped offset the negative Retail Sales figures released earlier and provided a mild boost to the GBP.

The services PMI showed an acceleration to 52.8 in July from 52.1 in June, while the manufacturing PMI slowed down to 51.5 from 51.9. Meanwhile, the Composite PMI rose to 52.5 from 52.2 in June. UK retail consumption contracted by 0.5% in July, meeting market expectations, and year-over-year sales increased at a 1.6% pace, which was below the consensus of 2.2%.

In Japan, the Consumer Price Index (CPI) accelerated to a 1.9% year-on-year rate in July, its highest level since December, while the core CPI rose to a 1.8% yearly rate. These factors added pressure on the Bank of Japan (BoJ) to raise interest rates in September, but the impact on the Yen was minimal. Investors were increasingly skeptical about the BoJ's ability to accelerate its tightening path, especially after Japan's preliminary GDP figures revealed economic growth slowing down in the second quarter.