GBP/USD extends decline despite UK jobs strength on BoE policy doubts

GBP/USD has deepened its correction, falling approximately 0.4% despite robust UK employment data, as uncertainty surrounding Bank of England policy decisions weighs on sterling. The UK labor market showed unexpected strength with unemployment remaining low and wage growth exceeding forecasts, typically supportive factors for the pound. However, traders are focusing on mixed signals from BoE officials regarding the pace of future rate adjustments, creating policy uncertainty that's undermining GBP strength. The pair has broken below the 1.2650 support level, with technical indicators pointing to further downside potential toward 1.2600. Market positioning suggests traders are reducing long GBP exposure ahead of upcoming BoE communications. The divergence between strong economic data and cautious central bank stance highlights the complex dynamics facing sterling traders, with near-term direction likely dependent on clearer BoE guidance.