Key events today:

19.08 06:00 UTC: GBP — Consumer Price Index.

19.08 18:00 UTC: USD — FOMC Meeting Minutes.

The pound approaches July’s inflation release following weak British labor market data. Unemployment remained elevated, job vacancies declined, and private sector wage growth slowed. These signals limit expectations of further Bank of England policy tightening, making the UK currency’s own fundamental support less solid than that of the euro.

However, the broader dollar backdrop remains more influential than the UK’s local weakness. Declining US Treasury yields and reduced expectations of an imminent Fed rate hike keep the greenback near multi-month lows. For GBPUSD, this creates room for recovery, although the reaction to British inflation could be sharp: stronger data will support the pound, while a soft report could temporarily shift the balance.

The base scenario remains in favor of GBPUSD upside. The UK labor market is cooling, but this factor has already been largely priced in following yesterday’s release, whereas the broader dollar momentum remains weak. Ahead of the FOMC minutes and barring an unexpectedly weak UK inflation print, the advantage remains with buying the pound against the dollar.

Recommendations: BUY 1.3540, SL 1.3505, TP 1.3610.