GBP/USD Near 1.35 Ahead of US Jobs Data

The broader setup still favors sterling if the US employment picture weakens. The dollar index was last at 99.09, below its 50-day average of 100.23 and its 200-day average of 99.17, while Adalytica’s US Dollar Trade Signals showed neutral sentiment at 66 but a sharp 30-day drop in change, hinting at a less forceful greenback backdrop. By contrast, sterling sentiment sits at extreme fear, which often leaves room for a rebound if the macro backdrop turns in its favor.

For investors, the main implication is that the pound’s next leg will likely be driven less by UK-specific data and more by the Fed path implied by US labor numbers. A weak payrolls report would reinforce bets that US rates have peaked or are closer to easing, narrowing the dollar’s yield advantage and supporting higher-risk and higher-beta currencies such as sterling.

That dynamic also matters beyond spot FX. A firmer pound can weigh on exporters in the UK while easing imported inflation, which may complicate the Bank of England’s policy calculus if domestic price pressures remain sticky. For global portfolios, any dollar retreat also tends to support commodities and non-US assets priced in dollars.

The near-term catalyst is the next US labor release, which could decide whether GBP/USD stays pinned near 1.35 or makes a run toward the upper end of its recent band around 1.37, where technical resistance has capped prior advances.