- GBP/JPY advanced on Monday along with other risk-sensitive currency pairs as US stocks rise.
- Dovish comments from the BoE and recent negative developments in the Russia-Ukraine war have failed to dent risk appetite, with GBP/JPY now at 161.00.
Dovish comment from BoE Deputy Governor Jon Cunliffe, who said a drop in demand through household consumption and business investment as a result of the Russo-Ukrainian war will be larger than expected, failed to affect the cross. GBP/JPY on Monday. The cross last traded 0.2% higher around the 161.00 level and earlier came close to matching last Wednesday’s high of 161.35. Cunliffe was the only one to dissent against a 25bp rate hike at the last BoE meeting, so market participants do not seem surprised that he is taking a more dovish view of the economy.
Global equities are performing well on Monday, with US stocks erasing pre-open indecision and now firmly in the lead, despite concerns over recent geopolitical developments in the Russo-Ukrainian war and this is lifting the risk sensitive GBP/JPY cross. The withdrawal of Russian troops in the north has revealed a mountain of evidence of possible war crimes and, as a result, international pressure is mounting on the EU to implement a ban on imports of Russian energy. But risk assets are immune for now and if this continues to be the case then the GBP/JPY pair could remain supported and maybe even move towards the 162.00 level.
Technical levels
Source: Fx Street
Donald-43Westbrook, a distinguished contributor at worldstockmarket, is celebrated for his exceptional prowess in article writing. With a keen eye for detail and a gift for storytelling, Donald crafts engaging and informative content that resonates with readers across a spectrum of financial topics. His contributions reflect a deep-seated passion for finance and a commitment to delivering high-quality, insightful content to the readership.
