|

Pound Sterling advances against US Dollar ahead of US JOLTS Job Openings data

  • The Pound Sterling rises to near 1.3450 amid risks of a likely US government shutdown.
  • US Democrats want Republicans to undo cuts in the healthcare budget.
  • BoE’s Ramsden argues in favor of interest rate cuts to support weakening job demand.

The Pound Sterling (GBP) extends its upside to near 1.3450 against the US Dollar (USD) during the European trading session Tuesday. The GBP/USD pair advances as the US Dollar trades cautiously amid fears of a potential United States (US) government shutdown, with Republicans struggling to persuade Democrats to support short-term funding bill before Tuesday’s midnight deadline.

The US Dollar Index (DXY), which tracks the Greenback’s value against six major currencies, trades marginally lower around 97.80.

Prospects of a partial US government shutdown have escalated significantly, following comments from Vice President (VP) JD Vance to CNBC, after meeting with Democrats, recognising that the administration could face a shutdown. “I think we’re headed to a shutdown because the Democrats won’t do the right thing,” Vance said.

Democrats have been denying approving the stopgap bill in the House of Senate as they want White House to roll back cuts in healthcare benefits announced earlier this year.

Meanwhile, the US Labour and Commerce departments have warned that the closure of statistical agencies, in the event of a partial shutdown, could halt the scheduled releases of key economic indicators, including official employment data for September.

Pound Sterling drops as BoE's Ramsden warns of labor market risks

  • The Pound Sterling faces slight selling pressure on Tuesday. The British currency trades marginally lower as Bank of England (BoE) Deputy Governor Dave Ramsden has argued in favor of reducing interest rates amid growing United Kingdom (UK) labor market concerns. Ramsden is also confident that inflationary pressures will return to the central bank as interest rates are still restrictive.
  • “We have seen the labour market continuing to loosen with wage growth normalising,” Ramsden said in a panel discussion organised by the European Central Bank (ECB) in Frankfurt on Monday, and added that "I [Ramsden] see that as supporting a continuation of the core disinflation process, which anchors his view on the inflation outlook," Reuters reported.
  • BoE Ramsden’s support for interest rate cuts is unfavorable for the Pound Sterling, as he was among seven of nine Monetary Policy Committee (MPC) members who voted to hold policy rates steady at 4% in the September policy meeting.
  • Meanwhile, UK Q2 Gross Domestic Product (GDP) data has come in stronger than previously estimated on an annual basis. The figures showed that the economy rose by 1.4% YoY, faster than the preliminary release of 1.2%. Quarter-on-quarter GDP growth remained in line with flash estimates of 0.3%.
  • In Tuesday’s session, the major trigger for the GBP/USD pair will be the US JOLTS Job Openings data for August, which will be published at 14:00 GMT.  US employers are expected to have posted fresh 7.1 million jobs, in line with the prior reading of 7.18 million.

Technical Analysis: Pound Sterling stays below 20-day EMA

The Pound Sterling gains marginally higher to near 1.3450 against the US Dollar on Tuesday. However, the near-term outlook for the Cable remains bearish as it stays below the 20-day Exponential Moving Average (EMA), which trades around 1.3483.

The 14-day Relative Strength Index (RSI) rebounds from 40.00, currently at 46. The pair would remain sideways if the RSI is stable in the 40.00-60.00 range.

Looking down, the August 1 low of 1.3140 will act as a key support zone. On the upside, the September 17 high of 1.3726 will act as a key barrier.

Author

Sagar Dua

Sagar Dua

FXStreet

Sagar Dua is associated with the financial markets from his college days. Along with pursuing post-graduation in Commerce in 2014, he started his markets training with chart analysis.

More from Sagar Dua
Share:

Editor's Picks

GBP/USD defends 1.3300 after strong UK PMI data

Following Thursday's sharp decline, GBP/USD clings to small gains above 1.3300 in the American session on Friday, supported by the upbeat UK Retail Sales and July PMI data. Nevertheless, the pair's upside remains capped as investors cling to a cautious stance amid a further escalation of tensions in the Middle East. The US July PMI data failed to trigger relevant price action.

EUR/USD remains below 1.1400 after mixed US PMIs

EUR/USD pressures daily lows below the 1.1400 mark in the American session on Friday. Mixed S&P Global PMIs, as manufacturing output contracted while services activity expanded in July, triggered no relevant market reaction. The focus remains in Middle East developments and inflation-related concerns.

Gold holds above $4,050 but momentum still missing

Gold builds on its modest intraday bounce and climbs above the $4,050 level on Friday, hitting a fresh daily high amid a modest US Dollar pullback. The fundamental backdrop, however, warrants some caution before confirming that the pullback from an over two-week high, touched on Wednesday, has run its course and positioning for any meaningful upside.

Ethereum: Derivatives interest in ETH improves, but signs of caution remain

Ethereum is hovering slightly below the $1,900 level, down 3% on Thursday following a slight expansion in derivatives interest. The top altcoin's open interest has increased to 14.60 million ETH, marking a 600K ETH increase over the past two days and its highest level since June 7.

XRP retreats as ETF interest cools
Ripple (XRP) slides toward the short-term $1.10 support on Friday, as broader crypto market sentiment weighs on crypto assets. The sell-off mainly stems from fears of inflation in the United States (US) amid the ongoing war in the Middle East and rising Oil prices.
US Dollar mid-year outlook: Exceptional currency, exceptional risks?
The US Dollar enters the second half of 2026 in a markedly different position from a year ago. The King currency has recovered, reflecting persistent US inflation, changing expectations for Fed policy, geopolitical tensions and renewed demand for defensive assets.