Prime focus today will be the U.S. July employment report and the main currencies are likely to remain in a consolidation pattern in the interim. GBP still looks vulnerable amid growing conjecture in markets that the BoE’s unexpectedly aggressive expansion of quantitative easing was in fact mostly, or at least partly, aimed at weakening the currency. The BoE has in the past often mentioned the role of GBP weakness in stimulating the economy. Although the pound unwound by a couple of big figures against the USD yesterday, the market had been running a fairly extreme net long position. As for the U.S. jobs report today, we expect a 320k decline (median -330k), encouraging after June’s 467k drop. Any unexpected improvement would likely be positive for the USD as it may put the end of the Fed’s more aggressive credit easing measures in sight. But, the unemployment rate should rise to 9.7% (median 9/6%) and risk for the headline is to the downside given the weakness seen in the ADP private payroll survey, the erosion in the employment component of the ISM service index and comments from White House officials warning of rising unemployment. On the other hand, jobless claims data suggest some stabilization in the labor market. Either way, the payrolls data will be a big focus.