The Pound Sterling (GBP) is soft, down 0.2% against the US Dollar (USD) as we head into Wednesday’s NA session, Scotiabank's Chief FX Strategists Shaun Osborne and Eric Theoret report.

GBP is trading defensively after Tuesday’s jobs data disappointment

"The GBP’s latest recovery looks to have stalled on the back of Tuesday’s employment release that offered broad disappointment across wage growth, jobless claims, and employment growth. The unemployment rate has pushed to a fresh post-covid high of 5%, threatening the December 2020 high at 5.3%."

"UK rate expectations are showing signs of stabilization following Tuesday’s jobs-driven decline, and UK-US yield spreads have bounced back. However, much of the GBP ‘s recent spread-driven gains have been eroded by this latest data disappointment."