GBP\/JPY rose for a fifth straight day and reached a two-month high near 213.85 in early European trading on Friday. The pair was set for strong weekly gains.<\/p>\n
The Japanese yen stayed weak amid concern about instability in the Strait of Hormuz. Iran again shut traffic through the route after Israeli attacks on Lebanon, and Donald Trump warned of fresh strikes if an Iran deal fails.<\/p>\n
About 90% of Japan\u2019s crude oil imports pass through the Strait of Hormuz. This raised concern about effects on Japan\u2019s economy if disruption continues.<\/p>\n
Benjamin Netanyahu said he instructed officials to begin direct negotiations with Lebanon as soon as possible. A US State Department official said Lebanon\u2013Israel talks will be held next week in Washington, DC.<\/p>\n
US\u2013Iran talks were scheduled in phases between late Friday night and Saturday. Hopes of a ceasefire helped limit crude oil price rises and reduced pressure on the yen.<\/p>\n
A firmer US dollar weighed on the pound and helped cap GBP\/JPY. Even so, the pair remained in an uptrend, with pullbacks seen as limited.<\/p>\n
A correction on 10 April at 08:14 GMT changed the move to a two-month high near 213.85, not a one-month high near 133.85.<\/p>\n
We recall a similar setup around this time in 2025 when GBP\/JPY was pushing above 213.00. Tensions in the Strait of Hormuz were a key factor then, creating significant headwinds for the energy-dependent Japanese economy. That fundamental weakness in the Yen ultimately proved correct, fueling the cross pair’s rally through the second half of that year.<\/p>\n
The primary driver for Yen weakness remains the vast interest rate gap, a factor even more pronounced today. With the Bank of England holding rates at a firm 5.5% to manage inflation, the Bank of Japan’s recent move to just 0.1% offers little support for its currency. This differential continues to make holding long GBP\/JPY positions attractive through carry trades.<\/p>\n
Geopolitical risk, highlighted by the events in 2025, remains a critical vulnerability for the Yen. Japan’s reliance on Middle Eastern crude oil has not diminished, with recent METI data showing over 92% of its supply still transits the region. Any flare-up in tensions could therefore trigger a rapid sell-off in the Yen, mirroring the price action we saw last year.<\/p>\n
Given the persistent upward trend, traders should view any pullbacks in GBP\/JPY as opportunities to position for further gains. Buying call options or implementing bull call spreads could be an effective way to capitalize on the upside while defining risk. These strategies would benefit from both a gradual grind higher driven by rate differentials and any sudden spike in volatility from geopolitical news.<\/p>\n
Create your live VT Markets account<\/a>\u00a0and\u00a0start trading<\/a>\u00a0now. <\/b><\/p>\n","protected":false},"excerpt":{"rendered":" GBP\/JPY hit two-month high near 213.85 as weak yen, Hormuz tensions drive strong weekly gains.<\/p>\n","protected":false},"author":38,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[46],"tags":[],"class_list":["post-44632","post","type-post","status-publish","format-standard","hentry","category-live-updates"],"acf":[],"aioseo_notices":[],"featured_image_src":null,"featured_image_src_square":null,"author_info":{"display_name":"josephine","author_link":"https:\/\/www.vtmarketsglobal.com\/en\/author\/josephine\/"},"_links":{"self":[{"href":"https:\/\/www.vtmarketsglobal.com\/en\/wp-json\/wp\/v2\/posts\/44632","targetHints":{"allow":["GET","POST","PUT","PATCH","DELETE"]}}],"collection":[{"href":"https:\/\/www.vtmarketsglobal.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.vtmarketsglobal.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.vtmarketsglobal.com\/en\/wp-json\/wp\/v2\/users\/38"}],"replies":[{"embeddable":true,"href":"https:\/\/www.vtmarketsglobal.com\/en\/wp-json\/wp\/v2\/comments?post=44632"}],"version-history":[{"count":0,"href":"https:\/\/www.vtmarketsglobal.com\/en\/wp-json\/wp\/v2\/posts\/44632\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.vtmarketsglobal.com\/en\/wp-json\/wp\/v2\/media?parent=44632"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.vtmarketsglobal.com\/en\/wp-json\/wp\/v2\/categories?post=44632"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.vtmarketsglobal.com\/en\/wp-json\/wp\/v2\/tags?post=44632"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}