GBP/USD slips on robust US data as Fed cut odds fade

• US jobless claims fall to 221K, while retail sales rise 0.6% in June.
• Fed's Kugler signals no rush to cut rates amid tariff-driven inflation.
• UK labor market cools less than expected, but Sterling remains pressured.

The GBP/USD drops during the North American session, edges down 0.07% following the release of strong US economic data that boosted the Greenback which hit a new July high as it recovers some ground at the beginning of the second half. At the time of writing, the pair trades at 1.3408.

Cable drops to 1.3408 as jobless claims and retail sales beat forecasts, reinforcing Fed's steady stance

The latest U.S. jobs report, released by the Bureau of Labor Statistics (BLS), revealed that the number of Americans filing for unemployment claims edged lower, indicating that the economy remains solid. Initial Jobless Claims for the week ending July 12 came at 221K, below forecasts of 235K. In addition to that, Retail Sales for June also exceeded estimates of a 0.1% MoM increase and rose by 0.6%.

The data, along with the rise in consumer prices last week, had slashed the chances for a rate cut by the Federal Reserve at the upcoming July meeting.

Fed Governor Adriana Kugler was hawkish, revealing that it is appropriate to keep policy steady "for some time," given the low unemployment and increasing price pressures from tariffs.

Across the pond, UK jobs data revealed that the labor market is cooling but at a slower rate than foreseen, as the Claimant Count Change in June rose by 25.9K above the consensus of 17.9K and 33.1K

In the meantime, uncertainty about a possible sacking of Fed Chair Jerome Powell by US President Donald Trump dissipated as he said that he was not planning to fire him, but continued to pressure the Fed to lower interest rates.

GBP/USD Price Forecast: Technical outlook

The GBP/USD remains neutral to downward biased, trading near the lows of the week, after reaching a two-day high of 1.3485 on the possible removal of Powell. The Relative Strength Index (RSI) suggests that sellers remain in control, despite buyers' increasing presence, near the 1.3400 mark.

If bulls want to regain control, they must claim the 50-day SMA at 1.3500. Otherwise, the GBP/USD would continue to edge lower with sellers eyeing 1.3373, the July 17 low, followed by 1.3300 and the 100-day SMA at 1.3278.