GBP/JPY TRADES AROUND 187.00 AFTER REBOUNDING FROM SIX-MONTH LOWS
- GBP/JPY holds gains following unexpected dovish comments from BoJ Deputy Governor Shinichi Uchida.
- BoJ’s Uchida emphasized to maintain its current level of monetary easing for the time being.
- The Japanese Yen may appreciate due to increased risk aversion amid heightened Middle East tensions.
GBP/JPY halts its losing streak that began on July 30, trading around 187.00 during the European session on Wednesday. This rebound could be linked to dovish comments from Bank of Japan (BoJ) Deputy Governor Shinichi Uchida, who stated, “We won’t raise rates when markets are unstable,” according to Reuters.
Deputy Governor Uchida also highlighted that the BoJ's interest rate strategy may adjust if market volatility affects economic forecasts, risk assessments, or projections. In light of recent market fluctuations, he stressed the importance of closely monitoring the economic and price impacts of their policies, stating, “We must maintain the current degree of monetary easing for the time being.”
The escalating geopolitical tensions in the Middle East could impact safe-haven demand and support the Japanese Yen (JPY), undermining the GBP/JPY cross. Hamas appointed Yahya Sinwar as its new leader in Gaza following the assassination of former chief Ismail Haniyeh on Tuesday, according to Reuters.
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