The British pound sterling against the US dollar continues to follow a downward trend. The current GBPUSD exchange rate stands at 1.2080.
The rapid rise in US treasury bond yields is bolstering the USD, affecting riskier assets and strengthening the USD against major currencies.
According to FedWatch, investors are expecting a Fed interest rate hike in November with a 35% likelihood and in December with a 55% probability. The potential increase in the interest rate spread between the Federal Reserve and the Bank of England is exerting pressure on the GBP.
Particular attention is now paid to the upcoming release of the Non-Farm Payroll (NFP) report for September, scheduled for Friday. If the statistics surpass expectations, the likelihood of an interest rate hike in November will increase. This, in turn, would support the dollar and put pressure on the pound.