Ella 
In early Asian trading on Thursday, GBP/USD rebounded from a multi-day low near 1.2620 and rebounded to 1.2660. GBP/USD was weighed down by renewed demand for the U.S. dollar ahead of important events in the United States. Investors awaited Thursday’s release of the U.S. personal consumption expenditures price index (PCE) for January for fresh impetus. As of press time, GBP/USD was trading at 1.2660, down 0.01% for the day.
New York Federal Reserve (Fed) President John Williams said on Wednesday that although the Fed’s 2% inflation target is still some way off, the door is opening to cut interest rates this year, depending on the performance of economic data.
Recent inflation data has led financial markets to delay the launch of interest rate cuts, which has provided some support for the dollar. However, the U.S. PCE price index to be released later may provide some hints about the trajectory of U.S. inflation.
On Wednesday, data released by the U.S. Bureau of Economic Analysis (BEA) showed that the annualized quarterly rate of U.S. gross domestic product (GDP) in the fourth quarter was 3.2%, compared with the previous value of 3.3%. The data was weaker than expectations for fourth-quarter growth of 3.3%.
Bank of England (BOE) policymakers said they need more evidence that inflation will fall to their 2% target before deciding to cut key lending rates. The Bank of England expects annual inflation to fall to 2% in the second quarter of this year from 4% last month, but will rise to 3% by the end of 2024 as the deflationary effect of lower natural gas prices weakens.
