Snapshot: GBP/JPY trades at 215.19, down 0.27% intraday, as markets digest the BoJ’s decision to hold rates at 0.50%. With no change in the BoJ’s outlook, and a focus on Yen weakness, the pair faces a headwind ahead of the 03:30 ET press conference.
- Watch for any shift in tone from Governor Ueda during the presser; a hawkish surprise could see a test of the 214.96 day low.
- Risk appetite remains fragile (S&P futures down 0.58%); a further deterioration would pressure GBP/JPY.
Bias into NY: We see downside pressure on GBP/JPY as the BoJ remains cautious despite Yen weakness; a break below 214.96 could open a test of 214.50. We see UK yields firming slightly but unable to offset the BoJ risk.