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Sterling Slips as U.S. Data Points to Economic Rebound

LONDON, June 3 (Reuters) - The pound fell against the dollar on Thursday, as data showing a step up in hiring by private employers in the United States pointed to a rapidly recovering economy and hinted at stronger monthly jobs numbers due Friday.

Investors had piled on bets against the dollar in recent months but have lately grown more cautious, wondering whether a surprisingly strong U.S. economic rebound threatened the theory that interest rates will stay low for a long time.

Sterling fell 0.41% to $1.4110 following the stronger than expected U.S. private payrolls data, having touched a three-year high of $1.4250 earlier this week.

April’s big miss on payrolls, when monthly hiring of 266,000 confounded expectations for 1 million, had left investors jumpy as to the strength of the U.S. recovery.

The pound edged up 0.1% against the euro to 86.04 pence .

Sterling had earlier on Thursday held steady as investors wait on firmer signals as to whether growing cases of a COVID-19 variant first found in India could delay the wider reopening of the British economy due on June 21.

Britain’s currency has been a top performer among its G10 peers this year, thanks to optimism around the country’s rapid vaccination programme and hopes its economy will therefore rebound quicker than some others.

Those hopes have frayed somewhat in recent weeks, however, as rising cases of the COVID variant now known as Delta led Prime Minister Boris Johnson to say he would be cautious in lifting restrictions on travel and social distancing.

The government is mulling a delay of a couple of weeks to the June 21 date for the lifting of the remaining restrictions, according to media reports on Wednesday.

(Reporting by Lawrence White; Editing by Angus MacSwan and Mark Potter)

Source: Reuters

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