The GBP/JPY currency pair, which expresses the value of the British pound sterling in terms of the Japanese yen, has fallen sharply into 2020 (in spite of a recent retracement to the upside). In truth, all GBP crosses have fallen sharply, owing perhaps not directly to the emergence of COVID-19 but rather the effects that the pandemic has had on markets.
There are reasons for the initial sell-off in GBP FX crosses. As I wrote in March, where I correctly predicted that GBP/CHF would strengthen after hitting the lows, I explained the following:
Historically,