The Bank of Japan (BoJ) said on Tuesday that Japan's core consumer inflation rate excluding one-off factors, as measured by the Japanese central bank's new gauge, climbed 2.7% in May. This figure exceeded the BoJ’s 2% target and eased from 2.8% in April.
There is something faintly absurd about a currency pair holding this high while one half of it represents a country that has just lost its prime minister. GBP/JPY settled Monday close to 214.00, sitting on its rising 50-day average after a pullback from this month's peak near 216.50.
Societe Generale’s Kit Juckes notes that UK political change is generating only modest Sterling (GBP) weakness, with EUR/GBP seen one to two percentage points higher and GBP/USD likely to test 1.30 this summer.