Forex Weekly Forecast: EUR USD, GBP USD & EUR JPY 26 January 2026

Wallet Investor predicts the pair to consolidate around 0.87 by the end of 2026 and continue its sideways movement during the entire 2027. MUFG projects GBP/EUR sliding to ~€1.11 by Q3-Q4 2026, as ECB eases sooner than BoE amid eurozone inflation nearing 2% and UK growth softening with sticky prices, eroding GBP’s yield edge. While bull and bear flags are relatively simple to identify, using different strategies can help enhance the effectiveness of these chart patterns.

Pound to Yen (GBP/JPY) Fundamental Analysis and Forecast

A purchasing power parity calculator is a tool that allows you to convert your income or expenditure from one currency to another fxchoice review using the concept of purchasing power parity (PPP). This indicator is measured in terms of national currency per US dollar. Conversely, if your currency has less purchasing power than another currency, your production costs may be lower than those of your foreign competitors, making your products more attractive to consumers. If your currency has more purchasing power than another currency, your production costs may be higher than those of your foreign competitors, making your products less attractive to consumers. Get a notification when your desired rate is reached and stay on top of currency shifts. Get a live quote on our send money page and see the full price upfront.

The mid-market rate is the midpoint between buy and sell prices in global currency markets. Our currency rankings show that the most popular British Pound exchange rate is the GBP to USD rate. Our currency rankings show that the most popular Japanese Yen exchange rate is the JPY to USD rate. How you should trade the GBP/USD pair is a personal decision you should make based on your risk tolerance, investing strategy, and portfolio composition, after researching the market to understand the latest trends, news, and analysis. Major banks and analysts project an appreciation of the pound against the US Dollar, and a gradual depreciation against the Euro, driven by global interest rates and the UK’s fiscal issues. Therefore, important economic and political news from the UK and the US directly affects the pound-dollar rate.

Long-term forecasts inherently involve greater uncertainty and are intended as reference points for strategic planning, such as investments or international finance decisions.
A purchasing power parity calculator is a tool that allows you to convert your income or expenditure from one currency to another using the concept of purchasing power parity (PPP).
The expectation is for two additional reductions during 2026, eventually bringing rates to approximately 3.25% over the medium term.
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It outperformed only the dismal US dollar, holding above 1.32, and the yen, which has had abysmally poor years, trading above 200.

Too many factors may affect the rate of the currency pair, and it’s best to be up-to-date with what’s happening in the global arena in order to make realistic and reliable predictions. It’s important to remember that any long-term forecasts, even the GBP/USD forecast, or any other currency pair, are too unreliable to believe in. The officials’ comments give a clue on how the central banks’ policies could change, and investors could develop trading strategies based on this. To understand the Fed’s intentions, one should track such economic indicators as inflation and unemployment rates. The more the economy heats, the more likely the central bank to phase out the quantitative easing program and hike the interest rates.

What is the JPY to GBP exchange rate today?

Purchasing power parity can affect your returns and risks when you deal with foreign currencies or assets. Purchasing power parity can affect your competitiveness and profitability in the global market. Purchasing power parity can affect your cost of living and your purchasing power when you travel or buy imported goods. This will allow you to determine how much money you would need in the other country to maintain your standard of living. With this tool, you can compare your salary in your currency with that of another country.

This disconnect between policy expectations and market pricing is creating powerful technical structures across major currency pairs. While many market participants believe the Fed will not rush into a rate cut, price action suggests something very different. The new trading week opens with high expectations and rising tension across the Forex market, as traders prepare for the upcoming Federal Reserve interest rate decision.

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You may also find live updates around the clock if any major changes occur in the currency pair.
The GBP/JPY rallies to a new weekly high of 213.98, up by more than 1.10% in the week, as mixed economic data from the UK, pushed the British Pound higher.
The ECB is forecasted to cut rates by 25 bps in 2026, which appears to favour euro upside against the pound, primarily due to the expected continued divergence in their respective monetary policy stances.
The trajectory of UK interest rates will largely influence the trajectory of the pound and the FTSE index.
This is generally positive for GBP, as higher interest rates make the UK a more attractive place for global investors to park their money.When inflation falls too low it is a sign economic growth is slowing.
1 JPY equals 0.005 GBP using the current mid-market exchange rate of £0.0047.

GBP to JPY chart

The trajectory of UK interest rates will largely influence the trajectory of the pound and the FTSE index. It outperformed only the dismal US dollar, holding above 1.32, and the yen, which okcoin review has had abysmally poor years, trading above 200. However, before deciding to participate in Foreign Exchange (FX) trading, you should carefully consider your investment objectives, level of experience and risk appetite. Vladimir Ribakov (vladimirribakov.com) does not gain or lose profits based on your trading results and operates as an educational company. Before deciding to trade foreign exchange or any other financial instrument you should carefully consider your investment objectives, level of experience, and risk appetite. All forms of trading carry a high level of risk so you should only speculate with money you can afford to lose.

How do central bank policies influence the GBP/JPY exchange rate?

If the ruling party wins big, the yen could fall even further. The market is also watching the February 8 election in Japan, which could be a turning point. The Japanese government’s big spending plans could keep the yen weak.

As flags are continuation patterns, the preceding trend is expected to resume. As we can see on the larger time frame, GBP/USD’s price action in 2025 has carved out a bullish flag pattern, within a long term bullish channel. Currently, they expect the BoJ’s next rate hike to emerge in October 2026. If the JPY stays below 155 and heads toward 152, ING analysts do not expect the BoJ to rush into another rate hike.

Raw Trading Ltd makes no representation and assumes no liability as to the accuracy or completeness of the information provided, nor any loss arising from any investment based on a recommendation, forecast, or other information displayed through the IC Social application. Any analysis displayed through the IC Social application does not constitute a personal recommendation and does not consider your personal investment objectives, investment strategies, financial situation or needs. A minimum deposit of USD 200 (or currency equivalent) gives you full access to all markets—Forex, Gold, Shares, Indices and more. Access 61+ currency pairs with raw spreads from 0.0 pips, lightning-fast execution and 24/7 support. A purchasing power parity calculator is only as accurate as the data and assumptions that it uses. A purchasing power parity calculator can help you compare your standard of living or economic performance with other countries or regions.

By using PPP exchange rates, you can adjust for differences in price levels and get a more accurate picture of your economic well-being or competitiveness. Purchasing power parity is an economic theory that compares the prices of goods and services across countries, taking into account the exchange rates. A purchasing power parity calculator works by using PPP exchange rates, which are based on the prices of a basket of goods and services that are representative of each country’s consumption patterns. PPP is an economic theory that compares the prices of goods and services across countries, taking into instaforex review account the exchange rates. If your currency has more purchasing power than another currency, you may expect that the exchange rate will adjust over time to reflect the difference in price levels, leading to a depreciation of your currency and a loss of value for your foreign assets. PPP exchange rates reflect the actual purchasing power of currencies, while nominal exchange rates may be affected by factors such as inflation, interest rates, speculation, etc.

Simplifying money transfers

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Inflation, spring wage negotiations, and the Japanese yen are the most closely watched indicators for the BoJ. More working days on the calendar will nudge 2026 GDP higher; analysts are forecasting around 1.2% expansion. The eurozone economy posted solid GDP gains across all four quarters of 2025, clocking in at a stronger-than-forecast 1.4% for the full year. Governor Bailey finally jumped on the cutting bandwagon, though the 5-4 split vote was pretty much expected. These factors weigh on business confidence and spending plans, tempering economic momentum overall. Following an unexpectedly robust start, the UK economy is anticipated to experience slower growth into early 2026, with GDP projected to rise by 1.1% in 2026.

If this occurs, the market structure shifts decisively bearish. The pair has completed two consecutive false breakouts above the 185 level, a classic warning sign of exhaustion. EUR/JPY presents a very different picture compared to the previous pairs. That scenario has played out well, with the pair gaining strong bullish momentum.

The Outlook Report presents the Bank’s outlook for developments in economic activity and prices, assesses upside and downside risks, and outlines its views on the future course of monetary policy. Not only does it attract more foreign investment but it may encourage the BoE to put up interest rates, which will directly strengthen GBP. Extended yearly projections for the GBP to JPY exchange rate, offering a speculative outlook over the next fifty years. Reference tables showing common amount conversions between GBP and JPY based on the current exchange rate.