GBP/JPY Exchange Rate Rallies as Disappointing Figures Emerge from Japan
The Pound Sterling Japanese Yen (GBP/JPY) exchange rate rallied over the course of this morning and is currently trading at a rate of ¥143.97.
The Japanese Nikkei services PMI for November fell to 52.3 from 52.4, which has done little to help the Yen fend off a rising Sterling this morning.
Despite some disappointing figures released from the UK, which showed that the Services PMI suffered a worse-than-expected fall from 52.2 to 50.4, this did little to stop Sterling in its rise against the Yen.
Yesterday, ministers were found to be in contempt of Parliament over the non-disclosure of legal advice over Theresa May’s EU withdrawal agreement, causing the Pound to weaken.
GBP/JPY Exchange Rate Slumps Yesterday as BoE’s Carney Warns of Food Price Increases
The Pound Japanese Yen (GBP/JPY) exchange rate fell during yesterday’s session, with the Pound weakening as a result of a speech given by Bank of England (BoE) Governor Mark Carney.
Carney warned that in ‘the most extreme scenario, on average your shopping bill goes up by 10%’, adding that if there was a more orderly exit from the European Union, the figure would drop to 6%.
Prior to this, Sterling rallied against major currencies as a statement from the European Court Justice advocate general, Manuel Campos Sánchez-Bordona essentially said that the UK could cancel Brexit.
His advice was that if a country is able to decide to leave the EU, it should also have the power to change its mind without the consent of the other 27 member states during the two-year exit process specified in Article 50 of the Treaty of the European Union.
GBP/JPY Exchange Rate Begins the Week Weak as Stronger-than-Expected Japanese Data Released
Monday saw the Japanese Yen rally against the Pound in the wake of better-than-forecast data released from Japan.
The Nikkei manufacturing PMI data for November showed an increase from 51.8 to 52.2, aiding the Japanese Yen in its rally against Sterling.
Furthermore, the monetary base for November increased from 5.9% to 6.1% despite a predicted fall, which aided JPY.
GBP/JPY Exchange Rate to Fall on the Back of Strong Japanese Data?
Thursday will see the publication of overall household spending in Japan for October compared to last year.
With forecasts suggesting an increase, it seems likely that if this is the case the Japanese Yen may find its feet against the Pound once more.
Friday will see the release of Japan’s leading economic index and coincident index for October, showing the performance of the Japanese economy in the short and medium term.
These are likely to bolster JPY if they impress.
With the lack of any notable UK data releases, it seems safe to assume that any movements in Sterling are going to be related to Brexit as the political drama continues in the lead up to Parliament’s vote on the PM’s withdrawal agreement next week.
The Prime Minister has warned ‘we should not let the search for a perfect Brexit prevent a good Brexit.’