- The BoJ is suspected of intervening in currency markets twice in one week.
- Markets estimate that the BoJ's interventions have cost 9 trillion yen.
The GBP/JPY pair has fallen back to recent lows following a second possible intervention in favor of the Yen by the Bank of Japan (BoJ). The pair has returned to the 192.00 area after falling more than 4% in two days from the 34-year high of 200.60.
In the second half of the first trading week of May, Japanese markets remain in the dark due to holidays, and markets are reeling following this week's two possible BoJ “Yinterventions”, as market studies suggest that the Japanese central bank spent around nine trillion yen to support the battered Japanese yen (JPY). The BoJ's market operations were 5.5 trillion yen above market expectations on May 1, and another 3.5 trillion yen was overspent on BoJ financing operations on May 2. No official statements are expected from the Japanese authorities.
The British Pound (GBP) will be keeping an eye on the next Bank of England (BoE) meeting, scheduled for Thursday. The UK's quarterly Gross Domestic Product (GDP) is also due out next Friday, and there isn't much data of interest on the Japanese economic calendar.
GBP/JPY Technical Outlook
The Guppy has been hit by two possible BoJ interventions, dragging the pair down from a more than three-decade high at 200.60. The pair has retreated to a short-term supply zone around the 192.00 level, with an immediate bottom around 191.00.
Despite potential central bank operations, GBP/JPY remains firmly in medium-term bullish territory, with the pair trading well above the 200-day EMA at 185.58. The pair continues to rise by 6.86% in 2024.
GBP/JPY hourly chart
GBP/JPY daily chart
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
