The GBP/USD pair attracts some sellers to 1.2614 after retreating from a daily high of 1.2640 during the early Asian session on Thursday. The sell-off of the major pair is backed by recent hawkish comments from US Federal Reserve (Fed) official, affirming the higher-for-longer stance and no need to rush the rate cuts.
Early Wednesday, Fed Governor Christopher Waller said that the US central bank is in no rush to cut the benchmark rate and may need to “maintain the current rate target for longer than expected.” Waller emphasized that the Fed is in no rush to cut the policy rate as it’s prudent to hold its restrictive stance for longer than previously expected to bring down inflation to the 2% target. His hawkish comments boost the Greenback higher to 104.45 and weigh on the major pair.
On the other hand, the Bank of England (BoE) held the interest rate unchanged at 5.25% for the fifth meeting in a row last week. The UK central bank turned dovish on the interest rate outlook, and this has exerted some selling pressure on the Pound Sterling (GBP). The BoE Governor Andrew Bailey said that interest rate cuts will be ‘in play’ at future BoE policy meetings.
Market players will monitor the speech by BoE's C. Mann and the final UK Gross Domestic Product (GDP) growth numbers for Q4 on Thursday. Any dovish comments from the BoE policymaker or the weaker-than-expected GDP number might extend the selling pressure on the GBP. On the US docket, the GDP annualized number, the weekly Initial Jobless Claims and the Michigan Consumer Sentiment Index will be due later in the day.
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