Ella 
In early Asian trading on Friday, GBP/USD was consolidating around 1.2622. Friday is Good Friday, so market trading may be light. The U.S. core personal consumption expenditures (PCE) price index will be released later. Inflation, the measure favored by the Fed, is estimated to have held steady at an annual rate of 2.8%.
Sterling remains under some selling pressure after economic data suggested the UK economy would slip into recession in the second half of 2023. UK fourth-quarter gross domestic product recorded a quarterly rate of -0.3%, unchanged from initial estimates. However, the GDP data did not affect market expectations for monetary policy, as investors had expected a mild recession at the end of last year.
In addition, rising expectations that the Bank of England (BOE) will cut interest rates three times this year, by 25 basis points each time, also weighed on the trend of the pound. Bank of England Governor Andrew Bailey said a rate cut would “be on the table” at the Bank of England’s future policy meeting.
On the other hand, the U.S. economy remained strong in the fourth quarter of last year. This therefore provided some support for the US dollar and pushed GBP/USD lower. Final U.S. fourth-quarter gross domestic product came in better than expected, rising 3.4% from the previous estimate of 3.2%. Meanwhile, initial jobless claims for the week ended March 22 were 210,000, down from 212,000 previously. Finally, the Michigan consumer confidence index for March was revised upward to 79.4, above the initial estimate of 76.5.
