The Pound Sterling to Japanese Yen (GBP/JPY) exchange rate is trending within a narrow range on Thursday morning.
As traders await the policy decision from the European Central Bank (ECB), the currency market has seen minimal volatility. Sterling fluctuated slightly after disappointing data caused a slight downtrend, but the downtrend was countered by positive comments from a Bank of England (BoE) policymaker.
The Japanese Yen, meanwhile, is generally trending lower versus most of its major peers as traders speculate that the ECB will disappoint investors intending to capitalise on cheaper government securities.
The Pound Sterling to Japanese Yen (GBP/JPY) exchange rate is currently trending in the region of 178.5200.
Pound Sterling (GBP) Exchange Rate Fluctuates on Miles’ Speech
British economic data printed disappointingly on Thursday, causing the Pound to soften versus many of its major peers. Central Government NCR increased from 7.6 billion, PSNB ex Banking Groups increased from 12.4 billion to 13.1 billion despite the median market forecast of a drop to 9.7 billion. Public Finances rose from 7.1 billion to 21.4 billion, and Public Sector Net Borrowing advanced from 11.7 billion to 12.5 billion, despite the market consensus of a drop to 9.0 billion.
However, the Pound declination caused by the reports was short-lived after a speech by BoE policymaker David Miles supported demand for the British asset. Miles stated that although domestic costs were rising weakly and wages were flat when measured alongside productivity, ‘I don’t think this really adds up to a strong case for looking to monetary policy to boost demand and prices right now.’
The Pound Sterling to Japanese Yen (GBP/JPY) exchange rate reached a high today of 179.2200.
Japanese Yen (JPY) Exchange Rate Ticks Lower ahead of ECB
The Japanese Yen softened fractionally versus many of its major peers as traders speculate that the ECB stimulus will disappoint. ‘They have to get out before the ECB in case there’s a disappointment,’ Ali Jalai, a bond trader said. ‘Treasuries have rallied a lot. They’re a little bit vulnerable.’
In addition, the Yen softened as a result of the Bank of Japan (BOJ) cutting their inflation expectation amid declination in the crude market. ‘Annual consumer inflation will likely slow for the time being reflecting the decline in energy prices,’ a BOJ report said.
Pound Sterling to Japanese Yen (GBP/JPY) Exchange Rate Forecast to Hold Steady
With market focus dominated by Eurozone proceedings, the Pound Sterling to Japanese Yen (GBP/JPY) exchange rate is likely to continue trending within a narrow range until more is known about the ECB stimulus measures.
The Pound Sterling to Japanese Yen (GBP/JPY) exchange rate climbed to a high today of 179.2200.
