GBP/USD Steady Amid Sideways USD Trading and Awaited US Jobs Data
The GBP/USD pair maintains a mild positive bias for the third consecutive day, holding steady just above the 1.2700 level during the Asian session on Thursday. However, spot prices lack strong bullish momentum and remain below the weekly high reached on Monday.
The US Dollar (USD) continues to consolidate in a sideways movement as traders await the release of the US Nonfarm Payrolls (NFP) report on Friday. This is seen as a key factor supporting the GBP/USD pair. However, expectations for a less dovish Federal Reserve (Fed) have triggered a slight rebound in US Treasury bond yields, providing some support to the Greenback. Investors are increasingly convinced that US President-elect Donald Trump's tariff policies and expansionary plans will drive inflation. Additionally, comments from several influential Federal Open Market Committee (FOMC) members, including Fed Chair Jerome Powell, suggest that the central bank will take a cautious approach to rate cuts. This has led to a modest recovery in US Treasury yields, which benefits the USD.
Geopolitical risks, including the ongoing Russia-Ukraine conflict and concerns over trade wars, continue to support the safe-haven USD. Meanwhile, British Pound (GBP) bulls are cautious, especially in light of Bank of England (BoE) Governor Andrew Bailey's expectations for four interest rate cuts in 2025, which caps the GBP/USD pair.
Looking ahead, traders are eyeing the UK Construction PMI for potential market movement, with the focus primarily on the upcoming US monthly employment report, which will likely guide the Fed's next policy decision.
Paraphrasing text from "FXSTREET" all rights reserved by the original author.
