The GBP/USD pair extended its decline to around 1.3430 during Asian trading hours on Thursday, with the Pound Sterling (GBP) under pressure against the US Dollar (USD) amid renewed concerns over the UK’s fiscal outlook.
Later in the day, focus will shift to key US data releases, including weekly Initial Jobless Claims, the ADP Employment Change report, and the ISM Services Purchasing Managers Index (PMI).
On Wednesday, UK Finance Minister Rachel Reeves announced she would deliver her annual budget on November 26. She stressed that the economy was not “broken” and reiterated her commitment to restraining public spending to ease inflation and borrowing costs, according to Reuters. Still, doubts over the UK’s ability to maintain fiscal discipline weighed on market sentiment, pushing the Pound lower against the Dollar.
In the US, the Bureau of Labor Statistics (BLS) reported that job openings fell to 7.181 million at the end of July, down from a revised 7.357 million in June and below market expectations of 7.4 million.
Meanwhile, weaker UK labor market data released on Wednesday has reinforced expectations that the Federal Reserve (Fed) will cut interest rates this month. According to the CME FedWatch Tool, markets are pricing in a 97% probability of a September rate cut, compared with 91% a week earlier, alongside expectations for a total of 139 basis points of easing by the end of next year.
