• The 200DMA at 153.20s and waning risk appetite during US hours amid geopolitical concerns weighed heavily on the pair.

GBP/JPY's upside has been somewhat diluted since Friday's start of US trade. The pair failed to surpass its 200-Day Moving average in the 153.20s earlier and then fell below the 153.00 level. The US session weakness coincided in a downturn risk appetite (US stock lost pre-market gains, and are now in red).

Market commentators pointed to a decrease in optimism due to earlier comments from Russian President Vladimir Putin, who noted "positives” in talks with Ukraine following the statement by Ukraine's Foreign Minister that "zero" progress was made at talks on Thursday. Western nations announced new sanctions against Russia for the invasion of Ukraine. Updates from the ground indicate that intense fighting continues with Russia being accused of multiple war crimes, and civilians still trying to flee some of its besieged cities.

GBP/JPY looks set to close the day 0.6% higher after rebounding from sub-152.00 Asia Pacific session bottoms. This is partly due to a stronger than expected January UK GDP Growth Update. However, uncertainty surrounding the conflict in Ukraine looks set to remain a concern. It is possible that a break above 200DMA next week may prove difficult.

GBP/JPY traders must also keep an eye out for geopolitics. On Tuesday, the BoE rate decision will be made and the BoJ rate determination will be made. GBP traders are pointing out downside risks ahead of next week's meeting. There is a risk that the bank does not raise rates 25bps as markets expect or takes a more cautious tone due to Ukraine-related uncertainties.