- GBP/JPY climbs to near 189.60 as the Pound Sterling performs strongly ahead of a meeting between US President Trump and UK PM Starmer.
- BoE’s Dhingra endorses a swift policy-easing cycle to address weakening consumer demand.
- The BoJ is highly expected to tighten its monetary policy further this year.
The GBP/JPY pair advances to near 189.60 in North American trading hours on Thursday. The pair gains as the Pound Sterling (GBP) strengthens, with investors focusing on the meeting between United States (US) President Donald Trump and United Kingdom (UK) Prime Minister Keir Starmer, which is scheduled for Thursday.
British Pound PRICE Today
The table below shows the percentage change of British Pound (GBP) against listed major currencies today. British Pound was the strongest against the Japanese Yen.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | 0.05% | -0.04% | 0.28% | 0.11% | 0.08% | 0.19% | 0.35% | |
| EUR | -0.05% | -0.08% | 0.30% | 0.08% | 0.04% | 0.15% | 0.30% | |
| GBP | 0.04% | 0.08% | 0.42% | 0.16% | 0.12% | 0.24% | 0.39% | |
| JPY | -0.28% | -0.30% | -0.42% | -0.23% | -0.26% | -0.18% | 0.00% | |
| CAD | -0.11% | -0.08% | -0.16% | 0.23% | -0.03% | 0.07% | 0.23% | |
| AUD | -0.08% | -0.04% | -0.12% | 0.26% | 0.03% | 0.12% | 0.26% | |
| NZD | -0.19% | -0.15% | -0.24% | 0.18% | -0.07% | -0.12% | 0.14% | |
| CHF | -0.35% | -0.30% | -0.39% | -0.00% | -0.23% | -0.26% | -0.14% |
The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the British Pound from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent GBP (base)/USD (quote).
UK Starmer is expected to discuss trade policies with US Donald Trump as the latter has threatened to impose tariffs on his trading partners. Market participants expect Starmer-Trump discussions on tariffs to be healthy as Trump said earlier this month that he is not sure about imposing tariffs on the UK but was confident that a “deal could be made” as Prime Minister Keir Starmer has been "very nice".
On the monetary policy front, firm expectations that the Bank of England (BoE) will follow a moderate policy-easing cycle could keep the downside in the Pound Sterling limited. Traders have fully priced in two interest rate cuts by the BoE this year. Meanwhile, the BoE has already reduced its key borrowing rates by 25 basis points (bps) to 4.5% in the policy meeting earlier this month.
Contrary to market expectations, BoE Monetary Policy Committee (MPC) member Swati Dhingra expects the monetary easing cycle to be faster than market expectations due to weak consumer demand. "I know 'gradual' has been interpreted in the media as 25 basis points (bps) per quarter but cutting interest rates at this pace for the remainder of 2025 would still leave monetary policy in an undesirable restrictive position at the end of the year, Dhingra said in a speech at Birkbeck on Monday.
Meanwhile, the Japanese Yen (JPY) underperforms across the board despite firm expectations that the Bank of Japan (BoJ) will raise interest rates again this year. BoJ hawkish bets have accelerated due to inflation pressures settling above the 2% target for a longer period. Also, BoJ officials have been confident about further increases in wage growth.
Pound Sterling FAQs
The Pound Sterling (GBP) is the oldest currency in the world (886 AD) and the official currency of the United Kingdom. It is the fourth most traded unit for foreign exchange (FX) in the world, accounting for 12% of all transactions, averaging $630 billion a day, according to 2022 data. Its key trading pairs are GBP/USD, also known as ‘Cable’, which accounts for 11% of FX, GBP/JPY, or the ‘Dragon’ as it is known by traders (3%), and EUR/GBP (2%). The Pound Sterling is issued by the Bank of England (BoE).
The single most important factor influencing the value of the Pound Sterling is monetary policy decided by the Bank of England. The BoE bases its decisions on whether it has achieved its primary goal of “price stability” – a steady inflation rate of around 2%. Its primary tool for achieving this is the adjustment of interest rates. When inflation is too high, the BoE will try to rein it in by raising interest rates, making it more expensive for people and businesses to access credit. This is generally positive for GBP, as higher interest rates make the UK a more attractive place for global investors to park their money. When inflation falls too low it is a sign economic growth is slowing. In this scenario, the BoE will consider lowering interest rates to cheapen credit so businesses will borrow more to invest in growth-generating projects.
Data releases gauge the health of the economy and can impact the value of the Pound Sterling. Indicators such as GDP, Manufacturing and Services PMIs, and employment can all influence the direction of the GBP. A strong economy is good for Sterling. Not only does it attract more foreign investment but it may encourage the BoE to put up interest rates, which will directly strengthen GBP. Otherwise, if economic data is weak, the Pound Sterling is likely to fall.
Another significant data release for the Pound Sterling is the Trade Balance. This indicator measures the difference between what a country earns from its exports and what it spends on imports over a given period. If a country produces highly sought-after exports, its currency will benefit purely from the extra demand created from foreign buyers seeking to purchase these goods. Therefore, a positive net Trade Balance strengthens a currency and vice versa for a negative balance.
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