The British pound fell in the European market on Thursday against a basket of major currencies, extending its losses for the third consecutive session against the US dollar, as the American currency strengthened following President Trumps signing of a bill to end the longest government shutdown in US history.

After the release of downbeat labor-market data in the United Kingdom, the probability of a Bank of England rate cut in December increased. To reassess those expectations, investors are now awaiting key figures on UK economic growth due later today.

Price Overview

GBP/USD exchange rate: The pound fell by about 0.2 percent to 1.3111 dollars, down from an opening price of 1.3133 dollars, after recording an intraday high at 1.3134 dollars.

On Wednesday, the pound lost roughly 0.15 percent against the dollar, marking a second straight day of declines amid ongoing correction and profit-taking from the two-week high of 1.3191 dollars.

US Dollar

The US dollar index rose by 0.1 percent on Thursday, maintaining gains for a second session and reflecting continued strength in the American currency against major and minor peers.

The rise came after President Donald Trump signed legislation ending the longest government shutdown in US history, effectively breaking the political deadlock in Washington.

This development eases concerns about a potential economic slowdown in the United States and paves the way for the resumption of regular government data releases, restoring confidence to financial markets.

UK Interest Rates

Data released this week in the United Kingdom showed a rise in monthly jobless claims, while the unemployment rate hit its worst level since April 2021, developments that ease inflationary pressure on Bank of England policymakers.

Following these figures, market pricing for a 25-basis-point rate cut in December increased from 60 percent to 80 percent.

UK Economic Growth

To reassess those expectations, investors are awaiting important data from London later today, including the quarterly GDP reading for the third quarter, the monthly GDP reading for September, and additional figures on UK manufacturing output.

Outlook for the British Pound

At Economies.com, we expect that if the upcoming data proves less hawkish than markets anticipate, the probability of a December rate cut will rise further, a development that would place additional downward pressure on the pound.