June US payrolls growth of 57K sharply undershot forecasts, reducing expectations for near-term Federal Reserve rate increases.
The British Pound climbed to 1.3370 against the US Dollar on Friday, poised for a 1.3% weekly gain, its strongest in three months. Weak US jobs data drove the move, with June nonfarm payrolls rising just 57K, well below the 110K forecast.
May’s payrolls were revised down to 129K from 172K, and the labor force participation rate fell to 62.1%, its lowest in five years. The figures dampened expectations for Federal Reserve rate hikes, with markets now pricing a 17% chance of a July hike and 53% for September, down from 28% and 65% earlier.
US Treasury yields declined, pulling the Dollar lower. In the UK, political uncertainty persists, though comments from potential leadership candidate Andrew Burnham eased investor concerns by pledging fiscal discipline.