• GBP/USD erased further below 1.3150 on Tuesday as markets bid the Greenback.
• Market sentiment took a hit after US PMI figures failed to meet expectations.
• US NFP figures loom ahead as traders try to gauge the depth of a first Fed rate cut.

GBP/USD softened on Tuesday, briefly testing below 1.3100 as Cable struggles to hold onto a bullish stance amid a near-term bearish pullback. Greenback bidding picked up the pace after a fresh batch of US Purchasing Managers Index (PMI) figures failed to meet market expectations, reigniting investor concerns about the potential for a US recession.

The data docket remains thin on Wednesday from the UK side, with little of note outside of low-tier final PMI figures for August. US labor figures remain a key point for market participants this week. 

ISM’s US Manufacturing PMI for August came in below expectations, printing at 47.2 and missing the median market forecast of 47.5. Despite a soft rebound from July’s multi-month low of 46.8 failed to galvanize markets, giving already flighty investors a perfect excuse to pull back from a recent lopsided tilt into bullish expectations.

Friday's US Nonfarm Payrolls (NFP) report looms large. It represents the last round of key US labor data before the Federal Reserve (Fed) delivers its latest rate call on September 18. Friday's NFP print is widely expected to set the tone for market expectations regarding the depth of a Fed rate cut, with investors fully priced in on the start of a new rate-cutting cycle this month.