Pound Sterling outperforms its peers amid risk-on mood, US NFP in focus

The Pound Sterling gains across the board amid a risk-on market mood.
US President Trump confirms that the ceasefire with Iran is intact.
Investors await the US NFP data for fresh cues on the Fed’s monetary policy outlook.

Sagar Dua FXStreet

The Pound Sterling (GBP) trades higher against its major currency peers, is up 0.43% around 1.3610 against the US Dollar (USD), during the European trading session on Friday. The British currency outperforms as demand for risk-sensitive assets remains upbeat amid hopes of a diplomatic solution between the United States (US) and Iran.

Pound Sterling Price Today

The table below shows the percentage change of British Pound (GBP) against listed major currencies today. British Pound was the strongest against the US Dollar.

	USD	EUR	GBP	JPY	CAD	AUD	NZD	CHF
USD		-0.34%	-0.40%	-0.11%	-0.15%	-0.34%	-0.38%	-0.31%
EUR	0.34%		-0.08%	0.24%	0.18%	-0.01%	-0.00%	0.05%
GBP	0.40%	0.08%		0.32%	0.26%	0.07%	0.08%	0.12%
JPY	0.11%	-0.24%	-0.32%		-0.04%	-0.26%	-0.27%	-0.20%
CAD	0.15%	-0.18%	-0.26%	0.04%		-0.22%	-0.22%	-0.16%
AUD	0.34%	0.00%	-0.07%	0.26%	0.22%		0.00%	0.05%
NZD	0.38%	0.00%	-0.08%	0.27%	0.22%	-0.01%		0.05%
CHF	0.31%	-0.05%	-0.12%	0.20%	0.16%	-0.05%	-0.05%

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).

As of writing, S&P 500 futures are 0.55% higher to near 7,375, reflecting a strong demand for riskier assets ahead of the United States (US) Nonfarm Payrolls (NFP) data for April release at 12:30 GMT. The US Dollar Index (DXY), which tracks the Greenback’s value against six major currencies, trades 0.3% lower to near 97.95.

The expectation that the month-long ceasefire between the US and Iran is intact remains stable after President Donald Trump confirmed, in an interview with ABC News, that strikes exchanged near the Strait of Hormuz were not meant to restart the war.

Going forward, investors will pay close attention to the US NFP data to get fresh cues on the Federal Reserve’s (Fed) monetary policy outlook. The Fed is expected to hold interest rates at their current levels by the year-end, according to the CME FedWatch tool.

The US NFP report is expected to show that the economy created 62K fresh jobs, significantly lower than 178K in March. The Unemployment Rate is seen as steady at 4.3%. Average Hourly Earnings, a key measure of wage growth, is estimated to have grown at a stronger pace of 3.8% Year-on-Year (YoY) against the previous reading of 3.5%.

Economic Indicator

Nonfarm Payrolls

The Nonfarm Payrolls release presents the number of new jobs created in the US during the previous month in all non-agricultural businesses; it is released by the US Bureau of Labor Statistics (BLS). The monthly changes in payrolls can be extremely volatile. The number is also subject to strong reviews, which can also trigger volatility in the Forex board. Generally speaking, a high reading is seen as bullish for the US Dollar (USD), while a low reading is seen as bearish, although previous months' reviews and the Unemployment Rate are as relevant as the headline figure. The market's reaction, therefore, depends on how the market assesses all the data contained in the BLS report as a whole.

Why it matters to traders?

America’s monthly jobs report is considered the most important economic indicator for forex traders. Released on the first Friday following the reported month, the change in the number of positions is closely correlated with the overall performance of the economy and is monitored by policymakers. Full employment is one of the Federal Reserve’s mandates and it considers developments in the labor market when setting its policies, thus impacting currencies. Despite several leading indicators shaping estimates, Nonfarm Payrolls tend to surprise markets and trigger substantial volatility. Actual figures beating the consensus tend to be USD bullish.

Author

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.

GBP/USD clings to multi-day peaks below 1.3500

GBP/USD trades with marked gains on Friday, now giving away some gains following an earlier surpass of the key 1.3500 yardstick. Indeed, Cable gathers fresh steam amid the strong offered stance in the Greenback, all after US NFP badly missed expectations in July.

EUR/USD: Post-NFP bounce falters around 1.1580

EUR/USD reverses Thursday’s decline and trades with solid gains in the 1.1560 region, or two-month peaks, on Friday. The pair’s firm performance comes in a context of a sharp correction in the US Dollar as investors continue to assess disheartening US NFP readings.

How Wall Street rigs the game [Video]

In this week’s Live from the Vault, Andrew Maguire is joined by Peter Antico and Sean Stone to discuss the Paradigm of Money - an in-depth expose of financial market corruption, from naked shorting to the two-tier system that protects Wall Street.

XRP Price Forecast: XRP nears critical $1.00 support

Ripple (XRP) remains pressured on Friday, trading around $1.03 at the time of writing. The token appears to hold this current level as support but lacks a catalyst to sustain a knee-jerk rebound toward the next key resistance at $1.10.

Is Gold about to enter its biggest bull run since 2020?

Gold has stormed back into the spotlight and its next move could leave late buyers chasing. On August 5, the yellow metal surged almost 7% – roughly $174 – to close near $4,308 an ounce, posting one of its biggest daily advances in recent history. A weaker U.S dollar, falling Treasury yields, changing Federal Reserve expectations and renewed safe-haven demand all struck at once.

9-3: Is the Federal Reserve’s vote tally Warsh's new forward guidance?

The rate did not move. Neither did the statement, and that’s the more interesting fact. Set the July 29 Federal Open Market Committee (FOMC) statement beside the one issued on June 17, and the two documents are identical apart from a single verb and a paragraph at the bottom naming three dissenters.