The British pound fell against a broadly stronger dollar at the start of a week where traders and the Bank of England (BoE) will get the latest insight into the strength of the labour market and price pressures.
Focus is on jobs data on Tuesday and inflation figures, which could give a hint on whether the BoE opts; for a second consecutive 50 basis point rate hike at its September meeting.
Headline CPI is expected to have jumped to 9.8% in July.
Money markets currently price in around an 85% chance of a half-point rate hike at the central bank’s September meeting and a total of almost 125 bps of tightening by year end.
30 out of 51 economists polled by Reuters between Aug. 9-12 expect the BoE to deliver another 50 basis point increase to borrowing costs next month.