Snapshot: GBP/JPY trades at 213.87, down -0.11% on the session. The primary driver remains the divergence between the Bank of England’s cautious stance and the Bank of Japan’s slow normalisation bias. All eyes on BOE Gov Bailey speaking at 09:20 London.
- Watch 213.59 – intraday low. Break below opens a test of 213.00.
- BoE Gov Bailey’s comments could trigger volatility; hawkish signals could trigger a short squeeze.
Bias into NY: Short GBP/JPY, targeting 213.00, as downside pressure persists on BoE’s reluctance to commit to rate cuts; the relatively stronger performance of the Nikkei 225 (+1.79%) and a bid in the FTSE 100 (+0.61%) suggest risk sentiment isn’t a deterrent to the carry trade.