The Pound Sterling gained strongly against major currencies on Tuesday, reaching its highest level against the US Dollar in over two months following the release of UK employment figures. According to the Office for National Statistics (ONS), the UK’s unemployment rate remained steady at 4.7%—matching economists’ forecasts and marking a four-year high.
In the quarter ending July, the UK added 232,000 jobs, close to the expected 220,000 and the previous quarter’s 239,000. Meanwhile, wage growth remained steady: average earnings excluding bonuses rose 4.8% year-over-year, slightly slower than June’s 5%, while earnings including bonuses rose 4.7%, marginally above expectations and up from 4.6% previously.
These steady employment numbers provide some reassurance to Bank of England (BoE) officials, who have voiced concerns over potential risks to the labor market. Earlier this month, BoE Governor Andrew Bailey said he was “more concerned about downside job risks” than other members of the Monetary Policy Committee (MPC), which voted to keep rates on hold in August.
What’s Next for the Pound?
Investors are bracing for a busy week ahead, with the UK Consumer Price Index (CPI) data due Wednesday and the BoE’s monetary policy decision on Thursday. The CPI is expected to show headline inflation rising slightly to 3.9% annually, up from 3.8% in July. Signs of accelerating inflation could support the case for the BoE to keep interest rates steady at 4%.
Pound Sterling Price Moves Today
The Pound was the strongest currency against the Australian Dollar on Tuesday. Below is a snapshot of percentage changes for the British Pound against major currencies today:
| Base \ Quote | USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF |
|---|---|---|---|---|---|---|---|---|
| USD | -0.31% | -0.23% | -0.21% | -0.03% | 0.05% | 0.07% | -0.31% | |
| EUR | 0.31% | 0.06% | -0.03% | 0.25% | 0.39% | 0.34% | 0.00% | |
| GBP | 0.23% | -0.06% | -0.06% | 0.20% | 0.34% | 0.29% | -0.07% | |
| JPY | 0.21% | 0.03% | 0.06% | 0.25% | 0.33% | 0.10% | -0.03% | |
| CAD | 0.03% | -0.25% | -0.20% | -0.25% | 0.08% | 0.05% | -0.26% | |
| AUD | -0.05% | -0.39% | -0.34% | -0.33% | -0.08% | 0.04% | -0.38% | |
| NZD | -0.07% | -0.34% | -0.29% | -0.10% | -0.05% | -0.04% | -0.31% | |
| CHF | 0.31% | -0.00% | 0.07% | 0.03% | 0.26% | 0.38% | 0.31% |
Note: The table shows daily percentage changes. The base currency is on the left, the quote currency at the top. For example, the GBP/USD box shows GBP as base and USD as quote.
Market Movers: Fed Dovish Bets Weigh on the US Dollar
The Pound climbed to nearly 1.3650 against the US Dollar during Tuesday’s European trading session, boosted not only by the UK jobs report but also by weakness in the US Dollar.
The US Dollar Index (DXY) dropped to a seven-week low near 97.00 amid rising expectations that the Federal Reserve (Fed) will cut interest rates on Wednesday. According to the CME FedWatch tool, there is now a 96% chance of a 25 basis point rate cut, with some betting on a larger 50 bps reduction.
This dovish Fed outlook stems from growing concerns about weakening US labor market conditions. Many Federal Open Market Committee (FOMC) members, including Chair Jerome Powell, have signaled support for easing monetary policy in response to slower job demand.
Investors will closely watch Wednesday’s Fed statement, the updated “dot plot,” and Powell’s press conference for clues on the US economic outlook and the impact of tariffs on inflation.
Ahead of that, US Retail Sales data for August is due Tuesday at 12:30 GMT, with sales expected to grow 0.3% month-over-month—slower than July’s 0.5% increase.
Technical Analysis: Pound Nears 1.3650
On Tuesday, the Pound broke above an Ascending Triangle chart pattern, climbing near 1.3650 versus the US Dollar—the highest in over two months.
- The horizontal resistance line of this pattern sits at the July 23 high around 1.3585.
- The upward-sloping support line traces back to the August 1 low near 1.3140.
A clear breakout above this pattern could trigger further gains.
The Pound is currently trading close to its 20-day Exponential Moving Average (EMA) around 1.3520, supporting the near-term bullish trend.
The 14-day Relative Strength Index (RSI) has climbed above 60, signaling strong upside momentum.
On the downside, the August 1 low of 1.3140 remains key support. Above, the July 1 high near 1.3800 is the next major resistance level.