British Pound remains weaker against Japanese Yen following UK economic data
GBP/JPY depreciates after registering gains in the previous day, trading around 208.30 during Asian hours on Friday. The currency cross loses ground as the British Pound (GBP) remains subdued against the Japanese Yen (JPY) following the release of key economic data from the United Kingdom (UK).
The British Pound (GBP) has continued to weaken against the Japanese Yen (JPY) following the release of UK economic data. In July, the UK's Gross Domestic Product (GDP) grew by 0.4% month-over-month, exceeding expectations of flat growth. Additionally, industrial and manufacturing production showed positive momentum, expanding by 0.2% and 0.9% respectively.
However, the Japanese Yen remains buoyed by expectations of a more aggressive monetary tightening stance from the Bank of Japan (BoJ) and ongoing capital repatriation. Despite this, the upside for GBP/JPY remains limited as soaring oil prices increase global inflation risks, putting pressure on market sentiment. Economists predict the BoJ will raise interest rates by 25 basis points to 1.25% this week due to persistent inflation concerns, signaling a gradual shift towards a conventional tightening cycle.
The Pound Sterling, the oldest currency in the world, is the fourth most traded currency in foreign exchange markets, accounting for 12% of all transactions. Its value is primarily influenced by the Bank of England's monetary policy decisions aimed at maintaining price stability around a 2% inflation rate.
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