Sterling gains 0.13% to 1.3500, supported by a 23K drop in US July nonfarm payrolls against an 80K forecast.
The British pound traded in a tight 45-pip range around 1.3500, up 0.13% and at its highest level since mid-July. The move follows weaker-than-expected US nonfarm payrolls, which fell by 23K in July versus an 80K consensus, while June’s figure was revised down to 20K. The dollar index dropped to its lowest since early June, lifting GBP/USD despite limited domestic catalysts.
Sterling’s advance—nearly two cents from early-August lows—has been driven by dollar weakness rather than UK fundamentals. Rate expectations shifted after the payrolls miss, with a September Fed rate hike now priced at 49.93%, down from over 50% pre-release. October and December meetings show higher odds for cuts, though the pound’s rally remains conditional on US policy moves.
The pair’s ceiling near 1.3550 suggests consolidation rather than a breakout, as markets assess whether the dollar’s decline will persist. UK data has had little impact, leaving sterling’s gains tied to external factors.