GBP/JPY hits a new multi-year peak at 212.30 as Japan faces political uncertainty

GBP/JPY Hits New Multi-Year Peak Amid Political Uncertainty in Japan

During Monday's Asian session, the GBP/JPY currency pair surged to a new multi-year high of 212.30, driven by the Japanese Yen's continued weakness against other major currencies. This decline in the Yen follows news from Reuters indicating that Japan’s Prime Minister, Sanae Takaichi, may be considering calling an early general election.

According to government insiders, Prime Minister Takaichi is weighing the possibility of holding a snap election as soon as February 8 or 15.

Speculation about an early election intensified after Hirofumi Yoshimura, leader of the Japan Innovation Party, revealed in an interview with NHK that he met with PM Takaichi on Friday and sensed a shift in her stance regarding the timing of the election.

These political developments in Japan come at a time when investors remain uncertain about when the Bank of Japan might implement its next interest rate increase.

GBP Steady Ahead of UK Employment Figures

Meanwhile, the Pound Sterling is holding steady as markets await the release of UK employment data for the three months ending November, which is set to be published on Tuesday. Market participants are closely monitoring these labor statistics for insights into the Bank of England’s future monetary policy direction.

Looking ahead to 2025, concerns about the UK job market persist, as businesses remain cautious about expanding their workforce in response to increased employer contributions to social security programs.