GBP/JPY

The GBP/JPY edges higher by about 0.29% on Tuesday, even as risk appetite has shifted to the sour side due to geopolitical developments that are driving global bond yields higher amid inflation fears. At the time of writing, the cross-pair trades at 209.02 after bouncing off daily lows of 208.25.

GBP/JPY trades on the front foot on Tuesday but remains confined to a narrow range following the Japanese Yen’s (JPY) sharp rally earlier this month.

Commerzbank’s Michael Pfister argues that rising Oil prices have sharply lifted UK rate expectations, with markets now discounting four Bank of England hikes by mid-2027 versus just over one in June.

The British Pound (GBP) faces slight selling pressure against the Japanese Yen (JPY), dropping to near 208.60 on Tuesday after the release of the United Kingdom (UK) labor market data for three months ending July.

The GBP/JPY cross-pair rises over 0.12% and trades at around 208.30 as risk appetite shifts to the sour side due to a rise in energy prices and bond yields, as investors grow uneasy about a possible reacceleration of inflation ahead of three monetary policy decisions by major central banks.

The GBP/JPY cross attracts some buyers at the start of a new week and maintains its bid tone around the 208.25-208.30 region through the first half of the European session.