Ella 
GBP/USD extended losses from a one-year high around 1.3045 earlier this week, trading lower for a second straight day on Friday. GBP/USD fell to fresh one-week lows in the $1.2935-$1.2930 area, with some greenback buying following the move despite a lack of bearish momentum.
Concerns about a renewed trade war between China and the United States and continued geopolitical tensions have weighed on investors’ appetite for risk assets. That sent U.S. stocks tumbling overnight and sent markets lower across Asia, helping the safe-haven dollar recover from near four-month lows and weighing on GBP/USD. That said, dovish expectations from the Fed may curb aggressive bets by USD bulls and provide some support for GBP/USD.
Market participants now appear convinced that there is a 100% chance that the Fed will initiate a rate-cutting cycle in September. The number of Americans filing for unemployment benefits last week, released on Thursday, once again confirmed this forecast, with data showing that the labor market is becoming looser. On the basis of falling inflation, this has created conditions for the Federal Reserve to start lowering borrowing costs. In contrast, investors have ruled out the possibility of the Bank of England (BOE) cutting interest rates as Britain reported higher-than-expected inflation on Wednesday.
In addition to this, UK gross domestic product (GDP) grew by 0.4% in May, which was better than expected, which may continue to support the pound (GBP) and help limit losses in GBP/USD. Traders now look to monthly UK retail sales data for fresh impetus. Later in the North American session, influential Fed officials will speak, which will drive dollar demand and generate short-term GBP/USD trading opportunities. That said, GBP/USD now looks set to record a weekly closing loss for the first time in four weeks, including this week.
