Investors are beginning to believe that the Bank of Japan (BoJ) may move away from its accommodative monetary policy stance, following positive remarks from Deputy Governor Shinichi Uchida last Thursday, stating that immediate policy tightening remains unlikely but increasing inflation could warrant future interest rate hikes.

GBP is pressured by the Bank of England (BoE) hinting at a potential interest rate cut in the coming months, with investors expecting a 25 bps cut by the end of the year. Investors are awaiting important economic data releases from the UK this week, including inflation rates and Q4 GDP figures.

Furthermore, investors are awaiting further guidance from BoE Governor Andrew Bailey, scheduled for Wednesday, prompting profit-taking to be delayed.