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GBP/JPY slips as yen gains support after yen spending data
JPY strength followed Finance Ministry data showing Japan spent a record ¥15.4 trillion between July 30 and August 26, which helped support the yen after USD/JPY hit a 40-year high near 164.00.
GBP/JPY was trading on the back foot as the Japanese yen strengthened versus major peers, with the cross around 216.40 after retreating from an intraday high near 216.85, according to FXStreet.
FXStreet said the yen drew modest buying after USD/JPY briefly moved above the psychologically important 160.00 level, which has previously prompted Japanese authorities to intervene, and after Finance Ministry data showed Japan spent a record ¥15.4 trillion, about $96.5 billion, supporting the yen between July 30 and August 26 following a surge in USD/JPY to a 40-year high near 164.00.
FXStreet also pointed to hawkish Bank of Japan expectations as additional support for the currency, while noting the longer term outlook remains fragile due to Japan’s expansionary fiscal policies, large government debt, and relatively low interest rates.
On the UK side, FXStreet said GBP lacked a fresh domestic catalyst because UK markets were closed for the Summer Bank Holiday, with the Bank of England widely expected to leave interest rates unchanged even as inflation stays above its 2% target.
Latest closeUSD/JPY 160.04 ▲0.5%