GBP Retreats on Geopolitical Uncertainty, US Inflation Data Looms

The Pound Sterling (GBP) retreated from an over three-week high against the US Dollar as traders shifted focus to upcoming US inflation data and Thursday's preliminary UK Q2 GDP report.

The GBP/USD pair had reached a peak above 1.3500 on Friday, but slipped back down as investors responded to renewed geopolitical uncertainty in the Middle East.

US July jobs data showed a loss of 23K positions, with the prior month revised down to 20K from 57K, tempering expectations for a September Federal Reserve rate hike.

The probability of a rate increase at the Fed's September meeting is now less than 45%, down from 67% a week earlier, according to market participants.