GBP/JPY holds steady above 210.50 after UK macro data; remains close to multi-week low

• GBP/JPY struggles to capitalize on intraday gains, though the downside remains cushioned.
• The UK macro data does little to influence the GBP or provide any impetus to spot prices.
• Delayed BoJ rate hike bets counter intervention fears and cap the JPY, supporting the cross.

The GBP/JPY cross attracts fresh sellers following an intraday uptick to the 211.22 area and retreats to the lower end of its daily range during the early part of the European session on Tuesday. Spot prices move little following the release of the UK macro data and currently trade just above mid-210.00s, close to over a three-week trough set on Monday.

The UK Office for National Statistics confirmed that Britain's economy grew by 0.1% in the October-December period, unrevised from the provisional estimate published last month. Additional details showed that business investment fell by 2.5% in the final quarter of 2025, compared to -2.7% reported originally. The backward-looking data, however, fails to provide any meaningful impetus to the British Pound (GBP) amid economic concerns stemming from the Iran war.

The UK economy is highly vulnerable to energy price shocks. Moreover, the Bank of England's (BoE) hawkish signal about a potential interest rate hike as early as April amid inflation fears raises downside risks to the economy, which, in turn, acts as a headwind for the GBP. The Japanese Yen (JPY), on the other hand, draws some support from speculations that authorities would step in to stem further weakness in the domestic currency. This contributes to capping the GBP/JPY cross.

Meanwhile, a government report showed earlier today that the headline Consumer Price Index (CPI) in Tokyo – Japan's capital city – slowed from the 1.5% and rose 1.4% in March, marking the lowest reading since March 2022. Adding to this, core gauges (excluding volatile fresh food and energy costs) also fell short of expectations and tempered bets for an immediate policy tightening by the Bank of Japan (BoJ). This acts as a headwind for the JPY and offers some support to the GBP/JPY cross.