GBP/JPY consolidates losses below 147

The GBP/JPY pair lost more than 100 pips and fell to a fresh session low of 146.15 after BoE Governor Carney disappointed the investors with his remarks. After the initial slide, the pair started to take back some of its losses and is now trading at 146.67, still down 0.8% on the day.

Following the BoE's decision to keep the monetary policy unchanged, Governor Carney essentially ignored the recent rise in inflation and argued that the current monetary policy was convenient, causing a GBP sell-off. He also added that the monetary stimulus was appropriate, not excessive.

• BoE’s Carney: Debt fuelled consumption boom not projected in forecasts
• BoE's Broadbent: BoE forecasts ‘are not that strong’

In the meantime, the equity indexes in the United States started the day under pressure, suggesting a weak risk appetite, which benefits the safe haven JPY and allows the pair to extend its correction rise. As of writing, the Dow Jones Industrial Average was losing 0.22%, while the S&P 500 was down 7.75 points, or 0.32%. Tomorrow's economic calendar doesn't feature any data that could directly impact the pair's movements and the market sentiment could remain as the main driver of the drive action.

Technical outlook

With a break below 146.15 (daily low), the pair could aim for 145.60 (May 8 low) and 145 (psychological level). On the upside, resistances align at 147.90 (daily high), 148.15 (May 10 high) and 148.50 (Dec. 15 high).