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Despite bullish options market signals, GBP/USD leans bearish toward 1.1680 as it falls to a new low since March 2020, extending Friday's downward trend.

In spite of this, the one-month risk reversal (RR) for the GBP/USD, which is the difference between call options and put options, printed a four-day rally at Friday's conclusion, reaching 0.025 at the latest. In doing so, the RR figure inverts the previous weekly print of -0.480 with the positive figures of 0.295.

Notably, the bearish inclination should have taken cues from the recent aggressive Fedspeak and economic anxieties surrounding the UK, particularly in the context of political uncertainty.

"Restoring price stability will take some time and involve 'forceful' use of the central bank's powers," said Fed Chairman Jerome Powell in his highly anticipated Jackson Hole speech on Friday. In addition, the policymaker noted that regaining price stability will likely necessitate keeping a restrictive stance for "some time."

On a separate page, Goldman Sachs predicts that the United Kingdom will enter a recession in the fourth quarter (Q4) of 2022 and reduces its Gross Domestic Product (GDP) prediction for 2022 from 3.7% to 3.5%. In its most recent analysis, the US bank also predicts that the recession would be "quite moderate."

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