Forex Markets Eye Weak NFP Release as GBP/USD Extends Downtrend

2025-12-24 23:53:19

Abstract generation in progress

Sterling weakness intensified on Wednesday, with GBP/USD sliding approximately 0.67% to trade near 1.3060 as market participants digested disappointing UK inflation data. The Pound Sterling failed to capitalize on the Consumer Price Index (CPI) release, instead extending a fourth consecutive daily decline and testing fresh multi-week lows against the US Dollar.

NFP Data Void Creates Market Uncertainty

The upcoming NFP (Nonfarm Payrolls) landscape has shifted dramatically with the US Bureau of Labor Statistics pre-canceling the October jobs report due to the federal government shutdown. This data gap has left forex traders scrambling for directional cues ahead of the new year, as policymakers face an extended information drought on employment trends.

Thursday’s release will feature September’s Nonfarm Payrolls figures, though market participants are already discounting the report’s potential to drive meaningful price action. The absence of October NFP data compounds the challenge, leaving the forex complex without critical labor market signals through the remainder of 2024.

Rate Cut Odds Pivot Lower

Fed rate cut expectations have shifted noticeably colder, with December rate decision odds now pricing just 30% probability of a cut on December 10, according to the CME FedWatch Tool. This repricing reflects growing market conviction around the Federal Reserve’s more cautious stance heading into the final quarter.

The combination of soft CPI inflation data, delayed NFP releases, and shifting monetary policy expectations creates a complex backdrop for GBP/USD and broader forex markets. Sterling’s inability to recover despite dovish UK inflation signals underscores the strength of underlying dollar demand and diminished appetite for pound exposure in the near term.

Technical Perspective

GBP/USD’s multi-week low near 1.3060 signals weakening technical support, with the continuation of Wednesday’s bearish momentum likely dependent on whether Thursday’s stale NFP print can generate any meaningful market response in the forex space.

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