• GBP/JPY attracts sellers for the second straight day and is pressured by a combination of factors.
• The UK political turmoil undermines the GBP, while geopolitical risks benefit the safe-haven JPY.
• A breakdown below the 100-day SMA favors bearish traders and backs the case for further losses.

The GBP/JPY cross drifts lower for the second consecutive day – also marking the third day of a negative move in the previous three – and slides below the 212.00 mark, hitting a one-and-a-half-week low during the Asian session on Friday. Spot prices now seem to have found acceptance below a technically significant 100-day Simple Moving Average (SMA) and remain vulnerable to decline further.

The British Pound (GBP) continues with its underperformance in the wake of the deepening UK political crisis and turns out to be a key factor weighing on the GBP/JPY cross. In the latest development, Britain's Health Minister Wes Streeting resigned from the government on Thursday, citing irreconcilable differences over the government’s handling of public health policy and budget allocations. Moreover, the UK Prime Minister Keir Starmer is under pressure to resign over hefty ​losses for the ruling Labour Party in last week's local elections.

Meanwhile, persistent geopolitical uncertainties benefit the Japanese Yen's (USD) relative safe-haven status against its British Pound (GBP) and further exert downward pressure on the GBP/JPY cross. The JPY bulls, however, seem hesitant amid worries about economic risks stemming from geopolitical tensions in the Middle East. The concerns resurfaced after data released earlier today showed that Japan's wholesale inflation—Producer Price Index (PPI) —surged 4.9% year-over-year in April amid rising oil and import costs due to the Iran war.

That said, speculations that Japanese authorities might step in again to stem the domestic currency's downfall against a broadly firmer US Dollar (USD) and the fundamental backdrop backs the case for further losses for the GBP/JPY cross. Even from a technical perspective, a break and acceptance below the 100-day SMA suggests that the path of least resistance for spot prices remains to the downside. Hence, any attempted recovery is likely to get sold into and runs the risk of fizzling out quickly in the absence of any relevant macro data.