GBP/JPY recovers early losses as UK Inflation rose more than expected in July
- GBP/JPY bounces back as hot UK CPI strengthens the Pound Sterling.
- Both the UK headline and core CPI rose at an annual pace of 3.8% in July.
- Investors await Japan’s National CPI data for July.
The GBP/JPY pair claws back its early losses and flattens around 199.20 during the European trading session on Wednesday. The pair attracts bids as the Pound Sterling (GBP) gains after the release of the United Kingdom (UK) Consumer Price Index (CPI) report for July, which showed that price pressures grew at a faster-than-projected pace in July.
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 New Zealand Dollar.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | 0.00% | -0.11% | 0.06% | 0.02% | 0.26% | 1.38% | 0.04% | |
| EUR | -0.01% | -0.12% | -0.09% | 0.01% | 0.27% | 1.30% | 0.02% | |
| GBP | 0.11% | 0.12% | 0.06% | 0.13% | 0.32% | 1.32% | 0.15% | |
| JPY | -0.06% | 0.09% | -0.06% | 0.07% | 0.31% | 1.40% | 0.22% | |
| CAD | -0.02% | -0.01% | -0.13% | -0.07% | 0.26% | 1.36% | 0.02% | |
| AUD | -0.26% | -0.27% | -0.32% | -0.31% | -0.26% | 1.00% | -0.19% | |
| NZD | -1.38% | -1.30% | -1.32% | -1.40% | -1.36% | -1.00% | -1.24% | |
| CHF | -0.04% | -0.02% | -0.15% | -0.22% | -0.02% | 0.19% | 1.24% |
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).
The Office for National Statistics (ONS) reported that the headline inflation grew at a faster pace of 3.8% on year, compared to estimates of 3.7% and the prior release of 3.6%. Accelerating price pressures are expected to force the Bank of England (BoE) to reconsider its “gradual and careful” monetary easing guidance for the remainder of the year. BoE officials could avoid reducing interest rates further if inflation proves to be persistent.
In the monetary policy meeting earlier this month, BoE Governor Andrew Bailey warned that rising food and energy prices are de-anchoring consumer inflation expectations. The UK central bank also raised one-year forward CPI projections to 2.7% from 2.4%.
Going forward, investors will focus on the flash UK Purchasing Managers’ Index (PMI) data for August, which is scheduled to be published on Thursday.
In Japan, investors await the National Consumer Price Index (CPI) data for July, which will be published on Friday. According to expectations, the National CPI excluding Fresh Food grew moderately by 3%. Signs of cooling inflationary pressures would dampen market speculation supporting interest rate hikes by the Bank of Japan (BoJ).
Economic Indicator
Consumer Price Index (YoY)
The United Kingdom (UK) Consumer Price Index (CPI), released by the Office for National Statistics on a monthly basis, is a measure of consumer price inflation – the rate at which the prices of goods and services bought by households rise or fall – produced to international standards. It is the inflation measure used in the government’s target. The YoY reading compares prices in the reference month to a year earlier. Generally, a high reading is seen as bullish for the Pound Sterling (GBP), while a low reading is seen as bearish.
Read more.Last release: Wed Aug 20, 2025 06:00
Frequency: Monthly
Actual: 3.8%
Consensus: 3.7%
Previous: 3.6%
Source: Office for National Statistics
The Bank of England is tasked with keeping inflation, as measured by the headline Consumer Price Index (CPI) at around 2%, giving the monthly release its importance. An increase in inflation implies a quicker and sooner increase of interest rates or the reduction of bond-buying by the BOE, which means squeezing the supply of pounds. Conversely, a drop in the pace of price rises indicates looser monetary policy. A higher-than-expected result tends to be GBP bullish.
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