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GBP/JPY Price Forecast – British Pound Skyrockets After Interest Rate Hike

By:
Christopher Lewis
Updated: Dec 16, 2021, 15:27 UTC

The British pound has rallied quite significantly against the Japanese yen during the trading session on Thursday, as the Bank of England raise interest rates.

GBP/JPY Price Forecast – British Pound Skyrockets After Interest Rate Hike

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The British pound has skyrocketed during the trading session on Thursday against most currencies, and of course against the Japanese yen would have been no different. There has been an overall “risk on” type of move for the session, and that will help this pair regardless. It is worth noting that we rose to the ¥152.50 level, an area that I had suggested could be a target. Whether or not we can continue is a completely different question, but clearly it would make a bit of sense if we did pause here.

GBP/JPY Video 17.12.21

The market continues to be noisy in general, but at this point I think we are probably going to see any pullback being bought into as it is clear we are trying to change the overall attitude of the market. If we can break out above here, then the ¥153.50 level would be the most likely target. The size of the candlestick is rather impressive, but I would not be surprised at all to see a little bit of a pullback.

After all, markets do not go in the same direction forever, but that does not mean that this is at the start of something bigger. As we head into the end of the year, we could get a bit of a “risk on rally” around the financial markets, which of course typically will help this pair rally as well. The Japanese yen been sold off makes quite a bit of sense at the moment, so combining that with the Bank of England raising interest rates, it is a good sign that this pair should continue higher.

For a look at all of today’s economic events, check out our economic calendar.

About the Author

Being FXEmpire’s analyst since the early days of the website, Chris has over 20 years of experience across various markets and assets – currencies, indices, and commodities. He is a proprietary trader as well trading institutional accounts.

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