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Sterling steadies just below 1.3600 after US data drive
The pound fell about 50 pips in the two hours after the 12:30 GMT US data block, with September rate hike odds slipping into the high 30s after July PCE.
Sterling was largely holding just beneath 1.3600 late Wednesday, about 0.4% lower on the day and roughly 55 pips below a session ceiling near 1.3650, after moving sharply following a key US data release.
FXStreet said the pound drifted through the European morning before giving up close to 50 pips in the two hours after the 12:30 GMT American data block, and it has since ranged flat at the lows heading into Thursday.
The move followed an expectations shift tied to the July Personal Consumption Expenditures price index, which came in at 0.2% month over month versus a 0.1% consensus, while core was also at 0.2% month over month. Markets treated the monthly inflation figures as the signal, easing September hike odds into the high 30s while leaving a year end increase priced near 73%.
FXStreet added that the same release included upward revisions that increased the inflation backdrop, including second quarter core PCE marked up to 3.7% quarter over quarter from 3.4%, headline PCE to 5.3% from 5.1%, and the GDP price index to 6.4% from 6.3%, alongside durable goods orders of 1.1% versus a 0.7% consensus. It also said real growth was 1.5% annualized and in line, while personal income rose 0.4% versus a 0.3% estimate.