GBP/USD Exchange Rate Falls as Weak Jobs Report Weighs on Pound
The GBP/USD exchange rate softened on Tuesday due to a deteriorating market mood that boosted demand for safe-haven assets, specifically the US Dollar. The Pound's decline was also influenced by the release of the UK's latest jobs report, which showed an unemployment rate of 4.9% in the three months to June.
The employment growth effectively halved at the end of the second quarter, and real earnings slowed down, further reducing the chances of a Bank of England (BoE) interest rate hike later in the year. The UK's consumer price index will be published on Wednesday morning, which may impact the Pound's value.
The US Dollar's recent recovery was fueled by geopolitical tensions, particularly with regards to the Strait of Hormuz and energy supplies. Brent crude prices climbed above $90 per barrel on Tuesday, adding to the uncertainty in the Middle East.