News Maker 23

The Pound Sterling weakened again against the US dollar during Thursday's trading (August 27), extending a period of pressure for the second consecutive day. GBP/USD fell approximately 0.05% to 1.3588, after briefly touching the 1.3600 level. Dollar strength was a primary factor, driven by US economic data indicating a still-solid labor market.

Initial Jobless Claims for the week ending August 22 dropped to 203,000, coming in below the forecast of 208,000. This figure indicates that layoff levels remain low and signals that the US labor market has not yet shown signs of a sharp slowdown.

Meanwhile, the US goods trade deficit widened to US$118.8 billion in July from US$102.1 billion the previous month. Despite the widening deficit, the market reacted more strongly to the robust labor market data and earlier inflation figures, allowing the Dollar Index to hold steady around 99.14.

Pressure on the sterling intensified after several Fed officials made hawkish comments at Jackson Hole. Kansas City Fed President Jeffrey Schmid described inflation as still "stubborn" and "sticky," while Austan Goolsbee stated that inflation remains a primary concern. Beth Hammack of the Cleveland Fed even suggested that now is the time to act, given persistent price pressures.

These comments heightened expectations that the Federal Reserve still has room to further tighten policy. With a relatively quiet UK economic calendar, the pound's current movements are largely driven by dollar strength and shifting expectations regarding US interest rates.

Newsmaker Analysis: GBP/USD currently holds a short-term bearish bias as long as the dollar remains supported by strong economic data and hawkish commentary from Fed officials. The 1.3600 area serves as initial resistance, while further weakness could see the pair testing the 1.3550–1.3500 range. Attention now turns to Kevin Warsh's speech at Jackson Hole, which could determine whether the pressure on the pound persists or begins to ease. (arl)

Source: Newsmaker.id