GBP/JPY trades broadly flat on Thursday after Wednesday’s modest pullback ended a four-day winning streak.
At the time of writing, the cross trades around 216.45, with momentum indicators suggesting limited buying interest
The Japanese Yen (JPY) stays broadly weak as concerns over Japan’s fiscal outlook and its relatively low interest rates compared with other major economies continue to weigh on the currency. This keeps the broader bias for GBP/JPY tilted to the upside. That said, sentiment around the British Pound (GBP) also remains somewhat fragile, with UK fiscal concerns elevated ahead of the October 28 Budget.
At the same time, the Bank of England’s (BoE) cautious stance and reluctance to raise interest rates further are limiting additional support for the Pound. In the near term, GBP/JPY is likely to remain in consolidation mode, with Tokyo Consumer Price Index (CPI) data due on Friday potentially providing the next directional catalyst. Technical Analysis On the daily chart, GBP/JPY maintains a mildly bullish bias, although the technical setup points to consolidation rather than a strong directional move.