Weaker-than-expected US nonfarm payrolls data reduces expectations for a Federal Reserve rate increase, lifting the pound against the dollar.
The British pound surged against the US dollar, trading at 1.3359, after US nonfarm payrolls data fell short of estimates. The weaker jobs report diminished market expectations for a Federal Reserve interest rate hike in the near term.
Prior to the release, markets had priced in a higher probability of further tightening by the Fed. The latest employment figures contrast with stronger prints earlier in the year, signaling potential softening in the US labor market.
The move reflects shifting sentiment toward monetary policy divergence between the Bank of England and the Federal Reserve.