- GBP/USD added to its heavy intraday losses and updated the daily low in reaction to the stellar NFP report.
- The US economy added 467,000 new jobs, while average hourly earnings posted strong month-on-month growth.
- The risk-off mood further benefited the safe-haven dollar and contributed to the intraday drop.
The pair GBP/USD continued to lose ground early in the European session and dipped to the key psychological level 1.3500 after the release of the US employment report.
As investors digested the Bank of England, the GBP/USD pair witnessed a drop in profit-taking on Friday and snapped a five-day winning streak to a two-week high. Intraday selling accelerated after headline NFP shattered market expectations and showed the US economy added 467,000 jobs in January.
Adding to this, the previous month’s reading was also revised sharply higher from 199,000 previously reported to 501,000. In addition, median hourly earnings posted strong 0.7% MoM and 5.7% YoY growth, helping to offset an unexpected spike in the US unemployment rate and providing some much-needed respite for dollar bulls. American.
Aside from this, the prevailing risk-off mood, as evidenced by generally weaker trading sentiment in equity markets, prompted aggressive short-covering around the safe-haven dollar. This, in turn, was seen as a key factor behind the latest flash drop in the GBP/USD pair over the last hour or so.
Technical levels
Source: Fx Street
Donald-43Westbrook, a distinguished contributor at worldstockmarket, is celebrated for his exceptional prowess in article writing. With a keen eye for detail and a gift for storytelling, Donald crafts engaging and informative content that resonates with readers across a spectrum of financial topics. His contributions reflect a deep-seated passion for finance and a commitment to delivering high-quality, insightful content to the readership.
