BoE comes into focus

Yesterday's currency recap

US job growth underwhelmed in July, with only 73,000 jobs added - far below the 110,000 consensus. In addition we saw a sharp downward revision of June’s figure to just 14,000 - a total negative adjustment of about 258,000 jobs. The unemployment rate rose to 4.2%, while sector gains were concentrated in healthcare and social assistance, and manufacturing and government payrolls declined. USD sold off aggressively after a stellar week, shedding around 1.1% on the USD index as rate-cut bets surged - September odds jumping to ~82% from ~38% previously.

Today's GBP rates

What we think

This week, focus will fall on the BoE decision on Thursday (where nearly a full rate cut to 4% is priced-in); US ISM services on Tuesday, eurozone retail sales on Wednesday and Canada’s employment data on Friday. Against this backdrop, following on from the bout of USD weakness on Friday, we will be monitoring market reaction to see if the greenback will correct further ahead of that ISM print, or whether markets think the correction on Friday is sufficient to encourage more buying.

GBP remains susceptible for further weakness, should the markets determine the BoE meeting to be more dovish than current expectations. Markets are pricing in one rate cut this Thursday, followed by a second rate cut in December and a third in April 2026.

Read more about the Bank of England's interest rate decision here:

• When is the next MPC meeting?
• When is the next BoE interest rate decision?

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