GBP Strengthens to Near 1.3550 as Fed Hike Bets Fade

The British Pound has gained strength to near 1.3550 against the US Dollar during early Asian trading hours on Tuesday, as bets on a US Federal Reserve rate hike fade.

Cooler US inflation data have prompted traders to reduce expectations of a rate increase at the Fed's September 15-16 policy meeting, with only a 35% probability priced in for a September hike and a 69% odds of a rate increase by December, according to the CME FedWatch tool.

The UK employment report will be in the spotlight later on Tuesday, with the Bank of England Chief Economist Huw Pill saying last week that stronger-than-expected UK economic growth readings reinforced the case for higher borrowing costs to bring inflation back to target.