Snapshot: GBP/JPY is coiling tightly after the Bank of England held its Bank Rate at 3.75% at 12:00 BST today. The MPC’s cautious hold, driven by resilient wages and services inflation running near 5%, preserves the UK’s substantial yield advantage over a slow-to-normalize Bank of Japan sitting at 0.50%.
- The BoE’s 8-1 vote split reinforces a high-for-longer policy path, defending Sterling on dips and keeping GBP/JPY buyers active ahead of major psychological support at 200.50.
- Yen intervention risk remains the primary threat during the NY session, where any sharp drop in US 10-year yields below 4.40% could trigger broader dollar liquidation and provoke Japanese authorities to act.
Bias into NY: Mildly bullish GBP/JPY. The structural policy divergence keeps the carry trade highly attractive; we favor buying dips above 200.50 for a retest of 202.20 as the London-NY transition gets underway.