The Pound Sterling steadies during the North American session, as the week begins in a risk-off mood, as evidenced by overall US Dollar strength in the FX markets, even though soft jobs data and trimmed hawkish Fed bets for the rest of the year.
At the time of writing, the GBP/USD trades at 1.3357 after reaching a daily low of 1.3328
GBP/USD steadies as Dollar demand offsets softer Fed repricing Last week’s US jobs report missed estimates, while figures for April and May were downwardly revised, triggering a repricing of a less hawkish Federal Reserve. Nevertheless, the Unemployment Rate is within the 4.5% level pencilled by officials towards the end of the year. Money markets had priced in a 22 basis points of tightening for the year’s end, according to Fed funds rates futures contracts.
Meanwhile, for the upcoming July meeting, there’s a 77% chance the Fed will keep rates unchanged, versus a slim 23% chance of an increase, according to Prime Terminal. Recently, the Institute for Supply Management (ISM) revealed that the Services PMI came as expected at 54.0 but ticked lower from 54.5. Other survey measures showed that input costs eased somewhat, while the Services Employment Index improved from 47.9 to 51.2.