The Pound Sterling (GBP) rises above 1.3150 against the US Dollar (USD) in Thursday's London session. The GBP/USD pair aims to extend Wednesday's recovery after weak United States (US) JOLTS Job Openings data for July sent the US Dollar (USD) on the back foot. The US Dollar Index (DXY), which tracks the Greenback's value against six major currencies, falls to near the crucial support of 101.00.
The Job Openings data, released on Wednesday, showed that fresh job vacancies posted by US employers stood at 7.67 million, the lowest in more than three-and-a-half years. Signs of a slowing job market supported expectations that the Federal Reserve (Fed) could start the policy-easing process aggressively.
According to the CME FedWatch tool, the possibility for the Fed to begin reducing interest rates by 50 basis points (bps) to 4.75%-5.00% in the September meeting has increased to 41% from the 34% recorded a week ago.
Going forward, the US Nonfarm Payrolls (NFP) data for August, which will be published on Friday, will be the major trigger for the US Dollar. The importance of the US labor market data has increased significantly as the Fed appears to be more concerned about preventing job losses as there is increasing evidence that inflationary pressures remain on track to sustainably return to the bank's target of 2%.
In Thursday's North American session, investors will focus on the ADP Employment Change and the ISM Services Purchasing Managers' Index (PMI) for August. The Initial Jobless Claims data for the week ending August 30 will also be important.
Source: FXstreet
