GBP/JPY climbs further beyond 129.00 handle, fresh weekly tops
|- The overnight Brexit optimism continues to underpin the British Pound.
- The reaction to Wednesday’s softer UK PMI turns out to be short-lived.
- Fading safe-haven demand weighed on the JPY and remains supportive.
The GBP/JPY cross quickly reversed the UK services PMI-led dip and climbed to fresh weekly tops - around the 129.30 region in the last hour.
The cross gained strong follow-through traction through the early European session on Wednesday and built on the previous session's solid recovery of over 130-pips - supported by the fact that the UK House of Commons passed a motion aimed at taking control of the daily agenda from the government.
Brexit optimism offset softer UK data
The cross did witness an intraday pullback following the disappointing release of UK services PMI, which fell to 50.6 in August from the previous month's final reading of 51.4, though the downtick turned out to be short-lived amid receding fears over Britain's exit from the EU without a deal.
It is worth mentioning that the latest UK political development is now expected to lead to a vote forcing the government to request another three-month extension to the Brexit deadline, though looming risk of a snap election in the UK might keep a lid on any strong follow-through positive momentum.
Meanwhile, a fresh wave of global risk-on trade - as depicted by a strong rally in equity markets - was seen weighing on the Japanese Yen's perceived safe-haven status and remained supportive of the pair's ongoing recovery further beyond the 129.00 round figure mark.
Technical levels to watch
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.