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GBP / JPY rejected in its first attack at the 140.00 level

  • GBP / JPY, rejected from 140.25, remains stable above 139.00.
  • The pound lost steam as enthusiasm for the coronavirus vaccine waned.
  • Wide JPY weakness keeps the pound near two-month highs.

The British pound extended its rally in early trading on Wednesday in an attempt to climb from the 135.75 area to levels above 140.00. The pair managed to hit one-month highs at 140.25 but was unable to consolidate at those levels and fell back towards the lower zone of the range at 139.00.

GBP loses steam as risk appetite wanes

The pound has failed to maintain its positive tone for the third day in a row and has lost momentum above 140.00 with optimism about the COVID-19 vaccine cooling down as markets scrutinize the details of the entire process as infections continue to rise. in Europe and the United States.

News of a vaccine has had a particularly strong impact on the GBP due to the economic damage caused by the pandemic in the UK and the high number of infections and victims registered in the country.

Additionally, pessimistic news from the Brexit talks have contributed to damaging confidence in the pound. Investors’ hopes for an imminent deal were dashed on Wednesday amid rumors that a goal of reaching a mid-November deal is likely to be missed.

GBP / JPY, however, remains fairly stable above 139.00 with the Japanese yen on the defensive amid slightly positive sentiment. Hopes for a global economic recovery and higher interest rates triggered by the vaccine still weigh on the safe haven JPY.

Credits: Forex Street

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