GBP Dips Below 207.50 as JPY Rallies, BoJ Rate Hike Looms

The British Pound (GBP) continued its decline on Wednesday, hitting session lows near 207.50 against the Japanese Yen (JPY), despite higher crude oil prices that are typically a headwind for JPY rallies.

The GBP/JPY pair had rebounded from year-to-date lows at 207.10 but was capped at the 209.00 area on Tuesday, and retreated again on Wednesday.

Rabobank strategists observed that September's Bank of Japan (BoJ) policy meeting is pivotal for global funding dynamics, and any clear signal of a faster BoJ hiking trajectory could challenge the durability of using the Yen as a low-cost funding currency.