GBP/USD rises to 1.3440 as strong UK data offsets US weakness
- GBP/USD rebounds from 1.3332 lows to 1.3442 as the US Dollar Index slips after Tuesday’s sharp rally above 98.50.
- The US JOLTS report shows July job openings fell sharply, highlighting tariffs’ drag on hiring and manufacturing weakness.
- UK Services PMI jumps to 54.2, easing fiscal worries, while BoE officials stress inflation risks and policy caution.
The GBP/USD pair advances on Wednesday during the North American session by 0.39% following the release of economic data from the United States (US). Also, fears of the United Kingdom's (UK) government being unable to meet its fiscal requirements eased on signs that the economy continued to fare well. The pair trades at 1.3442 after bouncing off daily lows of 1.3332.
Sterling gains 0.39% after upbeat UK Services PMI tempers fiscal fears, while weak US jobs data pressures Dollar
The Greenback is weakening on Wednesday following Tuesday’s rally, which sent the US Dollar higher, past the 98.50 figure during the session, according to the US Dollar Index (DXY). US data revealed that job openings in July fell to 7.181 million, down from 7.357 million (revised from 7.437 million) in June, revealed the Bureau of Labor Statistics (BLS).
The data revealed that hiring increased by 41K and layoffs increased to 12K. Economists blame the ongoing slowdown in the jobs market on US President Donald Trump’s tariffs.
Other data showed that Factory Orders in July fell 1.3% MoM, better than the expected 1.4% contraction. This report, coupled with Tuesday’s ISM Manufacturing PMI contracting for the sixth consecutive month, suggests that manufacturing activity continues to deteriorate.
Eyes will be on the release of Nonfarm Payroll figures on Friday. Estimates suggest that the US economy created 75K jobs in August, and an uptick in the Unemployment Rate.
Across the pond, strong Services PMI in the UK tempered fears of the government’s ability to show fiscal constraint ahead of the Autumn budget. S&P Global Services PMI rose by 54.2 in August, up from 51.8 in July, its highest level since April 2024.
Some members of the Bank of England (BoE) crossed the wires. BoE’s Governor Andrew Bailey said that he does not think that QT is the cause for the jump in bond yields, adding that inflation expectations are anchored around a level consistent with the inflation goal. He added that the path of rates will continue to the downside and that he is concerned about downside job risks.
BoE Governor Taylor said that she is concerned to get inflation sustainably to 2%, and that maintaining monetary policy restrictiveness as long as necessary, but no longer.
GBP/USD Price Forecast: Technical outlook
GBP/USD bounced off the weekly lows of 1.3332 and reclaimed 1.3400, which opens the door to test the 100-day SMA at 1.3450. If breached, traders could test the 20-day SMA at 1.3483, and the 50-day SMA at 1.3484. On further strength, the 1.35 handle lies overhead.
Conversely, a daily close below 1.3400 will expose the September 3 low of 1.3332, ahead of the 1.3300 figure.
Pound Sterling Price This week
The table below shows the percentage change of British Pound (GBP) against listed major currencies this week. British Pound was the strongest against the Japanese Yen.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | 0.15% | 0.38% | 0.73% | 0.40% | -0.06% | 0.16% | 0.43% | |
| EUR | -0.15% | 0.23% | 0.50% | 0.24% | -0.21% | 0.00% | 0.28% | |
| GBP | -0.38% | -0.23% | 0.18% | 0.03% | -0.42% | -0.21% | 0.11% | |
| JPY | -0.73% | -0.50% | -0.18% | -0.26% | -0.76% | -0.52% | -0.25% | |
| CAD | -0.40% | -0.24% | -0.03% | 0.26% | -0.44% | -0.23% | 0.09% | |
| AUD | 0.06% | 0.21% | 0.42% | 0.76% | 0.44% | 0.22% | 0.56% | |
| NZD | -0.16% | -0.00% | 0.21% | 0.52% | 0.23% | -0.22% | 0.32% | |
| CHF | -0.43% | -0.28% | -0.11% | 0.25% | -0.09% | -0.56% | -0.32% |
The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the British Pound from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent GBP (base)/USD (quote).
(This story was corrected on September 3 at 16:33 GMT to say that June's JOLTS print was revised from 7.437 million to 7.357 million)
Author
Christian Borjon Valencia
FXStreet
Christian Borjon began his career as a retail trader in 2010, mainly focused on technical analysis and strategies around it. He started as a swing trader, as he used to work in another industry unrelated to the financial markets.
