• GBP/JPY slips for a third day as Japan’s intervention warnings weigh on the cross.
• Japanese officials reiterate readiness to act against excessive currency moves.
• Markets look ahead to the BoJ meeting and Japan CPI, with UK labour, inflation and Retail Sales also due.

The British Pound (GBP) remains under pressure against the Japanese Yen (JPY) on Friday, with GBP/JPY extending losses for a third straight session as repeated warnings from Japanese officials revive speculation over possible currency intervention. At the time of writing, the cross trades around 211.60, hovering near one-week lows.

Japanese officials remain increasingly concerned about what they describe as one-sided and speculative currency moves, reiterating that recent Yen weakness does not reflect underlying economic fundamentals. Japanese Finance Minister Satsuki Katayama said recently that authorities “will take appropriate action against excessive currency moves without excluding any options,” including the possibility of coordinated action with the United States.

The latest bout of Yen underperformance has been largely driven by rising political uncertainty, after reports that Prime Minister Sanae Takaichi plans to dissolve parliament next week and call a snap general election as early as February.

Meanwhile, attention is also turning to the Bank of Japan’s (BoJ) interest-rate decision on January 23. The central bank is widely expected to keep its policy rate unchanged at 0.75%, underscoring a gradual pace of normalization. BoJ Governor Kazuo Ueda said earlier this month that the central bank remains prepared to raise interest rates further if economic conditions evolve in line with its projections.

According to a recent Reuters poll, economists expect the BoJ to keep interest rates unchanged at its upcoming January and March meetings, but see further tightening later in 2026. Most respondents said the central bank will likely raise its key rate from the current 0.75% to 1.0% or higher by the end of September, with July cited as the most likely timing for the next hike.

In the UK, the policy outlook remains tilted toward gradual easing, though officials have signaled that the decision is becoming a closer call. Bank of England (BoE) policymaker Alan Taylor said this week that interest rates “should continue on a downward path, if my outlook continues to match up with the data, as it has done over the past year.”

Looking ahead, next week’s calendar features several key data releases. In the UK, traders will focus on labour-market figures, inflation data, and Retail Sales. In Japan, the national Consumer Price Index (CPI) is due just hours ahead of the BoJ’s policy decision.