The British pound (GBP) edged lower against the Japanese yen (JPY) on Monday as the yen strengthened across the board after Japanese authorities stepped up verbal intervention after USD/JPY headed towards the 160.00 level, a threshold that had previously triggered official action.
At the time of writing, GBP/JPY is trading around 210.2, its lowest level since March 6.
Japan’s top currency diplomat Atsushi Mimura said on Monday that officials would not rule out any action to respond to excessive currency movements. He warned that speculative activity was increasing in FX markets and said that if this continued, “we believe decisive action may soon become necessary.”
Meanwhile, the Bank of Japan (BoJ)’s summary of opinions highlighted growing concern among policymakers, with one member saying monetary tightening may be necessary if cost-push pressures intensify due to a very weak yen or if the effects of second-round inflation become more pronounced.
Another member said the central bank should pay close attention to whether it becomes necessary to accelerate the pace of rate increases or move toward more neutral or restrictive financial conditions as the conflict in the Middle East intensifies.
Additionally, BoJ Governor Kazuo Ueda said the central bank will closely monitor foreign exchange developments and assess their implications for achieving its 2% inflation target. He said the BOJ will appropriately guide monetary policy by assessing how currency movements affect the outlook for growth, prices and related risks.
Verbal intervention helped support the yen, although volatility is likely to increase as oil prices remain high amid the ongoing US-Israel war with Iran, adding to inflation pressures from the weaker currency and keeping the BOJ on a tighter path.
Traders are also reassessing the monetary policy outlook and betting on imminent rate hikes in major economies, as investors are more concerned about the impact of rising energy prices on economic growth than inflation.
In the United Kingdom, traders have reduced expectations for a rate hike by the Bank of England (BoE) in April, but still see about two rate hikes later this year, a sharp change from earlier expectations of a rate cut.
Looking ahead, attention now turns to upcoming data releases, including Tokyo CPI, Japan’s unemployment rate and retail trade figures, as well as the United Kingdom’s GDP (QoQ) for Q4, due on Tuesday, which could provide new direction for GBP/JPY.
Japanese yen price today
The table below shows the percentage change of the Japanese Yen (JPY) against the major currencies listed today. The Japanese yen was the strongest against the New Zealand dollar.
| USD | EUR | gbp | JPY | scurvy | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | 0.45% | 0.55% | -0.54% | 0.22% | 0.27% | 0.57% | 0.14% | |
| EUR | -0.45% | 0.09% | -0.97% | -0.23% | -0.14% | 0.12% | -0.32% | |
| gbp | -0.55% | -0.09% | -1.09% | -0.32% | -0.25% | 0.03% | -0.40% | |
| JPY | 0.54% | 0.97% | 1.09% | 0.77% | 0.83% | 1.10% | 0.68% | |
| scurvy | -0.22% | 0.23% | 0.32% | -0.77% | 0.05% | 0.29% | -0.09% | |
| AUD | -0.27% | 0.14% | 0.25% | -0.83% | -0.05% | 0.28% | -0.14% | |
| NZD | -0.57% | -0.12% | -0.03% | -1.10% | -0.29% | -0.28% | -0.43% | |
| CHF | -0.14% | 0.32% | 0.40% | -0.68% | 0.09% | 0.14% | 0.43% |
The heat map shows the percentage change of major currencies against each other. The base currency is selected from the left column, while the quote currency is selected from the top row. For example, if you select Japanese Yen from the left column and move along the horizontal line to US Dollar, the percentage change displayed in the box will represent JPY (base)/USD (quote).
