GBP/USD rose off the mats on Wednesday, clawing its way back above the 1.3400 handle after general market sentiment recovered just enough footing to buoy Cable off of four-week lows below 1.3350. Although broad-market investor sentiment is leaning into the risk-on side as traders clamor for an interest rate cut from the Federal Reserve (Fed), a dovish outing from Bank of England (BoE) Governor Andrew Bailey crimped GBP gains.

BoE Governor Bailey cautioned that the BoE is still very much in the "discussion" phase of making changes to its Quantitative Easing (QE) programs. The BoE makes one adjustment to its QE spending habits every year, at its September interest rate call meeting. UK lawmakers have been clamoring for the BoE to tamp down on its purchases of government debt instruments in an effort to appear less spendthrift than government ledgers have been recently.

However, that may not be as convenient a decision as perceptions allow: BoE face value losses on UK debt are already estimated to be in the ballpark of £100B, and the UK's economy may not be strong enough to withstand more than a slight adjustment to the BoE's bond buying plans.

US ADP Employment Change figures from August and the latest ISM Purchasing Managers Index (PMI) are in focus. ADP Employment Change data will be released to markets on Thursday. While ADP data has a weak connection to Friday's upcoming official NFP jobs report and often performs poorly as a predictor, investors still watch ADP's initial numbers for any major developments. The ISM Services PMI is expected to show signs of improvement in business outlooks as firms head into the fourth quarter.

Source: Fxstreet