• The GBP/JPY cross tallies a third-consecutive day of losses falling to a low of 181.10, below the 20-day SMA.
• Andrew Bailey commented that he doesn’t know when rates will start to come down.
• Eyes on British labour market data on Tuesday and Japanese data on Wednesday.

The GBP/JPY lost ground at the start of the week and currently stands around 181.60. Andrew Bailey’s, Governor of the Bank of England (BoE), hawkish remarks somewhat boosted the GBP while the JPY gained interest in rising Japanese bond yields. 

On Monday, Bailey commented that inflation is “unacceptably high”, far from their 2% target, but confirmed that the Monetary Policy Committee expects headline inflation to drop significantly this year. In addition, he commented that he doesn’t know when rates will start to come down and that the committee is closely monitoring the labour market. That being said, Tuesday's Claimant Count and Earnings data will be crucial.

On the other hand, Japanese yields continue to rise after strong Labor Cash Earnings data released last Friday in Japan, suggesting that markets may expect the Bank of Japan to pivot from its dovish stance to a more aggressive one. However, BoJ’s officials may need to gather more data so Machinery Orders and Producer Price Index data, to be released on Wednesday, will be closely monitored