Sterling Extends Losses as US Jobs Data Absence Clouds Near-Term Forex Outlook

GBP/USD declined roughly 0.67% on Wednesday, sliding toward the 1.3060 level amid a broader pullback in risk appetite. The Pound Sterling entered a fresh phase of weakness after the UK’s Consumer Price Index (CPI) report failed to inspire fresh buying interest, instead driving Cable into its worst run in several weeks with a fourth straight session of losses.

Market Context: The NFP Problem

The forex landscape faces a peculiar challenge ahead. The US Bureau of Labor Statistics has already ruled out publishing October’s Nonfarm Payrolls (NFP) figures, blaming disruptions from the federal government shutdown. This has left derivatives traders scrambling to reassess their rate expectations.

Interest rate futures markets have responded sharply. Using the CME FedWatch Tool as a barometer, traders have trimmed their bets on a December 10 Federal Reserve (Fed) rate cut down to approximately 30%—a significant shift from prior positioning. The absence of fresh employment data removes a key pillar supporting policy guidance until year-end.

What’s on Tap Thursday?

September’s NFP jobs report is slated for release Thursday. Yet market participants are already pricing in limited immediate impact, given that the October data vacuum will leave policymakers operating with one hand tied until 2025 rolls around. Without fresh labor market readings to anchor expectations, volatility in forex pairs like GBP/USD could remain elevated but directionless.

The broader takeaway: Sterling weakness reflects not just UK inflation disappointment, but a deeper uncertainty around how central banks will navigate data gaps in the months ahead.