FXStreet (Mumbai) – The dovish BOE minutes, QIR, followed by an equally dovish Carney at press conference pushed the GBP/JPY pair below 186.00 levels and tested 200-DMA at 185.79 levels.
No rate hike at the turn of the year?
Carney refrained from saying that the rate hike could happen at the turn of the year; something which he has been repeatedly saying in the last few months. This, coupled with a bearish CPI and GDP forecast has drastically reduced the possibility of a rate hike happening at the turn of the year.
The 2-yr UK gilt yield, which mimics rate hike bets, fell by more than 5-bps. The focus now shifts to the action in the US stocks and tomorrow’s Non-farm payrolls report.
GBP/JPY Technical Levels
The immediate resistance is seen at 186.45 (hourly 50-MA) and 186.84 (hourly 50-MA), above which the pair could test 187.69 (daily high). On the downside, a failure to sustain above (200-DMA), could trigger a drop to 184.32 (50% of 180.36-188.28).
(Market News Provided by FXstreet)