The GBP/JPY pair has shown resilience on Thursday, rebounding from recent lows and climbing back above the 203.00 level. While the pair attempted to reclaim 204.00, it fell short during the session. This recovery comes after suspected interventions by the Bank of Japan (BoJ) and Japan’s Ministry of Finance (MoF) aimed at strengthening the Yen.
While there’s no official confirmation of intervention, market movements and heightened BoJ financial operations suggest such activity. Defending the Yen is proving to be an increasingly costly endeavor for the MoF.
UK economic data, including average earnings and claimant count change figures, has been released, with retail sales figures expected on Friday. Meanwhile, Japanese CPI inflation data is due on Friday, with forecasts anticipating a slight uptick to 2.7%. However, this may not be enough to alter the BoJ’s ultra-loose monetary policy.
Technically, GBP/JPY found support near 202.50, leading to a bounce towards 204.00. While intraday price action remains below the 200-hour EMA, 202.50 serves as a critical level for potential further short pressure. Despite the suspected interventions, the pair is trading well above key moving averages and at 16-year highs.