GBP/JPY Analysis Report

Oct 17, 2022

VOT Research Desk

After encountering challenges at the immediate barrier of 167.00 during the Tokyo session, the GBP/JPY pair has slightly fallen to about 166.70.

The S&P500 has given up some gains following a stronger bounce, which has put pressure on the pound bulls.

This is due to a relaxation in the risk-on impulse. The prospects of a future increase in the BOE-BOJ policy divergence have increased as a result of Bank of England (BOE) Governor Andrew Bailey’s monetary policy direction. In response to the inflation target, BOE Bailey’s said, according to Reuters, “We will not hesitate to hike interest rates.” Price pressures, in the opinion of the central bank, call for tighter policy measures than those that were initially outlined in August. The UK Consumer Price Index (CPI) statistics will be crucial this week.

The inflation rate for both the headline and core measures may rise by 10 basis points to 10% and 6.4%, respectively. A return to double-digit inflation might cause greater economic challenges for the UK.