GBP/JPY continued its upward trend, marking a 13-day winning streak and reaching a new 16-year high above 206.00. The UK’s PMI figures for June showed slight improvement, giving a boost to the British Pound (GBP). However, the upcoming UK Parliamentary Elections on Thursday are expected to bring some volatility to GBP pairs.
The Bank of Japan (BoJ) remains committed to its loose monetary policy stance, causing the Japanese Yen (JPY) to weaken against other major currencies. Despite warnings from Japanese policymakers, the Yen’s decline remains steady.
The UK’s Labour Party is predicted to win the majority in the upcoming elections, potentially replacing the current Conservative government. Polls suggest a significant lead for Labour, with Keir Starmer expected to become the new Prime Minister. This political shift could introduce fresh volatility to GBP markets.
In terms of technical analysis, GBP/JPY has shown strong bullish momentum, trading above the 200-day Exponential Moving Average (EMA) and up 13.3% from its low in 2024. Charts indicate a positive outlook for the pair.
Overall, the Pound Sterling (GBP) is influenced by factors such as monetary policy decisions by the Bank of England, economic data releases, and trade balance indicators. Strong economic performance and positive data typically strengthen the GBP, while weak indicators can lead to a decline in its value.