Following the NFP, the GBP/USD made a decent recovery from two-and-a-half-month lows.
In June, the US economy added 850K new jobs, compared to 700K expected.
The positive reading was tainted by an unexpected increase in the unemployment rate.
Following the release of the US monthly jobs data, the GBP/USD pair reversed an early European session slide to the lowest level since mid-April and rallied almost 40 pips.
According to the headline NFP data, the US economy added 850K new jobs in June, compared to 700K projected. Furthermore, the previous month’s reading was raised to 583K from 559K previously reported.
The good news was tempered by an unexpected increase in the unemployment rate, which rose to 5.9% from 5.8% in May. The disappointment weighed on the US dollar, as did a sharp drop in US Treasury bond yields.
This was viewed as a crucial reason, prompting some short-covering activity in the GBP/USD pair. Concerns regarding the spread of the more contagious Delta version of the coronavirus, on the other hand, should limit the upside.
Nonetheless, the GBP/USD pair is on course to close the week with significant losses and appears set to continue on its downward trend. As a result, any further upward movement could be viewed as a selling opportunity./n
