GBP/USD Edges Down as Traders Scale Back Hawkish Fed Bets

The GBP/USD pair is trading around 1.3500 during the European session on Tuesday, edging down as the US Dollar (USD) ticks up.

However, financial markets are skeptical about a potential recovery in the market, with traders scaling back bets for a hawkish Federal Reserve (Fed) policy meeting in September due to weak US Nonfarm Payrolls (NFP) data for July.

Economists at ING describe the July jobs report as 'surprisingly weak,' noting that nonfarm payrolls fell 23k on the month and adding that 103K of downward revisions to the past two months' data dragged the 3M average gain in payrolls down to just 20,000.

The odds of the Fed holding interest rates steady in September have increased to 50% from 30.4% seen a month ago, according to the CME FedWatch tool.