GBPJPY Breaking Out
The recent GBPJPY long idea from the breakout above 163.18 highs is now moving nicely higher and the pair is around mid-way to target at the 168.39 level. The recent surge higher in GBP has benefited the trad nicely with the Pound boosted by confirmation of Liz Truss as the new UK PM. Despite criticism over her proposals, traders at least have welcomed the return of some certainty and clarity with regard to UK politics. Additionally, hawkish BOE expectations are driving GBP higher against JPY here given the stark divergence in monetary policy between the two central banks. Comments today from ex Japanese MoF Watanabe, who said that there is no need to intervene in current JPY moves, have certainly fed into this narrative. Near-term the outlook remains firmly bullish for the pair with the retail market now heavily short.
Keep An Eye On
Today’s BOE monetary policy report hearings, where the bank sets out its quarterly forecasts, will be closely watched by traders. In particular, inflation forecasts will be key for GBP. If inflation is forecast to remain higher for longer, this will keep hawkish BOE expectations firmly in place, keeping GBP supported near term.
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With 10 years of experience as a private trader and professional market analyst under his belt, James has carved out an impressive industry reputation. Able to both dissect and explain the key fundamental developments in the market, he communicates their importance and relevance in a succinct and straight forward manner.