In the first five trading days of August, the pair only managed two positive closes, returning to the 1.3440 level. U.S. Treasury yields have remained stable due to consistent hawkish commentary from the Federal Reserve, while U.K. gilt yields have declined amid concerns about sluggish domestic economic growth. That’s pushed Treasury yields higher and backed the dollar. Meanwhile, institutional investors reduced their short-dollar positions in anticipation of key U.S. economic data releases, including Non-Farm Payrolls (NFP) and ISM services figures. This leaves sterling largely influenced by U.S. economic data rather than having its own domestic drivers this month.