GBP/JPY exposed to selling pressure

The GBP/JPY has reached a fresh two-day high at around 163.62. Investors’ optimism augmented their appetite for risk-sensitive currencies like the pound.

The pair erases Wednesday’s losses and soars on Thursday amidst a risk-on impulse that augmented appetite for riskier assets, meaning safe-haven peers sustaining losses. The pair is trading at fresh two-day highs, up almost 1%.

Wall Street is set to finish Thursday’s session in the green territory, up between 1.14% and 2.22%. Recession fears that the US Federal Reserve would be unable to curb inflation without tipping the US economy into contractionary territory faded. Meanwhile, Fed officials reiterated that a 75 bps rate hike in July is the base case scenario while adding that the US economy is solid.

On Thursday, the GBP/JPY’s price action illustrates the pair opening around 162.00, followed by a dip towards the middle of the 161.00-162.00 area, and then rallying more than 150 pips, reaching a daily high at around 163.62. However, as the New York session ended, the cross-currency pair settled at around 163.52.