- GBP/JPY surged 100 pips from a two-week low hit earlier on Wednesday.
- Brexit headlines are causing volatility in GBP.
The GBP/JPY rebounded from a two-week low in the European session hitting a daily high around 136.70. The move, however, lacked follow-through.
The pair initially extended its declined from one-month highs around 137.80-85 region and remained under pressure in early trade on Wednesday The Pound was weighed down by concerns surrounding new coronavirus restrictions and the lingering threat of negative rates from the Bank of England
Negative Brexit headlines added pressure to the Pound Reports suggest that progress in talks with Britain is “still not sufficient” for a trade deal.
A Bloomberg report said that the UK will not walk away from Brexit talks immediately and that the UK will continue to try to reach a deal with the European Union past Prime Minister Boris Johnson’s October 15 deadline.
This sparked short-covering moves for the pound sending Sterling 100 pips higher. Muted trade for the safe-haven Japanese yen is doing little to influence the GBP/JPY