British Pound hits two-week low vs firmer Yen amid BoJ rate hike bets, intervention risks
The GBP/JPY cross attracts fresh sellers following an intraday uptick to the 209.00 neighborhood and drops to a two-week low during the first half of the European session on Monday.
The British Pound (GBP) experienced a two-week low against the Japanese Yen (JPY) on Monday, following a dip in spot prices to around 207.80-207.70. This decline was attributed to heightened demand for the Yen, as traders anticipated potential interest rate hikes by the Bank of Japan (BoJ) to combat inflation concerns. Minutes released from the BoJ's July monetary policy meeting indicated policymakers were considering faster rate hikes in October or December.
Speculation of intervention by Japan's Finance Minister, Satsuki Katayama, further bolstered expectations for a stronger Yen. However, a slight weakness in the US Dollar (USD) provided some support to the GBP, limiting potential losses. Meanwhile, the Bank of England's (BoE) cautious stance on interest rates, due to persistently high energy prices, added to the bearish sentiment for the GBP/JPY pair. Overall, traders should exercise caution before making further bearish bets on the GBP/JPY cross.
Written by urgent.news from FXStreet's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
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