Snapshot: GBP/JPY trades firmly near 203.20, gaining 0.4% on the session after the Bank of England held the Bank Rate at 3.75% with a hawkish-leaning 8-1 vote split. This policy hold, coupled with UK average earnings printing at a sticky 4.0% earlier this morning, reinforces the domestic yield advantage over the Yen. The decision keeps the pressure on BoJ policymakers as the massive interest rate differential remains unchallenged.
- Key support on GBP/JPY now sits at 202.00, with the 8-1 BoE vote split confirming that any imminent rate-cut path remains blocked by resilient wage growth and core CPI ticking up to 2.6%.
- Risk appetite during the NY session is a key watch-item, as a 12.3% surge in the VIX to 18.44 could trigger sudden JPY safe-haven inflows if US equities stumble at the cash open.
Bias into NY: We remain tactically bullish on the pair, targeting a test of 204.00 as the BoE’s persistent caution contrasts sharply with Tokyo’s slow-walk normalisation. Any risk-off pullback driven by US equity volatility should be treated as a buying opportunity rather than a structural reversal.