GBP/USD snaps the two-day winning streak above 1.2450, eyes on US GDP data

The GBP/USD pair snaps the two-day winning streak near 1.2460 amid the modest rebound of the US Dollar (USD) on Thursday during the early Asian session. The release of the US Gross Domestic Product (GDP) for the first quarter (Q1) will take center stage on the day. Also, the usual weekly Initial Jobless Claims and Pending Home Sales will be due. 

On Wednesday, US Durable Goods Orders improved by 2.6%, or $7.3 billion, to $283.4 billion in March, compared to the 0.7% increase (revised from 1.4%) in February. The increase in overall orders was the biggest since November 2023, according to the US Census Bureau. Meanwhile, Durable Goods Orders ex-transportation increased by 0.2%, while new orders excluding defense rose 2.3% in March. Both figures came in weaker than expected. Nonetheless, these reports did not have a significant impact on the US Dollar Index (DXY). 

Several US Federal Reserve (Fed) officials and Fed Chair Jerome Powell emphasized that rate cuts aren’t coming in the coming months as inflation remains stickier than expected. The hawkish comments and the higher-for-longer stance from US Federal Reserve (Fed) officials have boosted the Greenback and created a headwind for the GBP/USD pair. 

On the other hand, the markets anticipate that the Bank of England (BoE) will wait until next quarter to lower borrowing costs, according to median forecasts in a Reuters poll. The BoE Governor Andrew Bailey and other BoE officials stated that inflation in the United Kingdom declined in line with the central bank's expectations and the risk of elevated inflation had reduced, paving the way for a rate cut. The speculation is that the UK Central Bank will begin its easing cycle before the US Fed drags the Pound Sterling (GBP) lower and caps the downside of the major pair.