GBP/USD attracts some buyers above 1.2950, US presidential election looms

• GBP/USD drifts higher to around 1.2970 in Monday’s early Asian session, up 0.40% on the day. 
• The USD remains under selling pressure amid weaker US NFP data, uncertainty around the US presidential election.  
• The BoE is expected to trim the rate by a quarter-point to 4.75%.

The GBP/USD pair jumps to near 1.2970 on the softer Greenback during the Asian trading hours on Monday. The US Dollar (USD) remains under some selling pressure after the weaker US Nonfarm Payrolls (NFP) data for October, which provides some support to the major pair. 

After delivering a 50 basis points (bps) rate reduction in September to start the easing cycle, the US Federal Reserve (Fed) is anticipated to cut its policy rate by 25 bps in the November meeting. Markets are pricing this outcome with a roughly 97% probability. The Greenback edges lower as traders brace for the US presidential election and Fed interest rate decision this week. 

Analysts expect Donald Trump's policies on immigration, tax cuts, and tariffs would put upward pressure on inflation, treasury bond yields, and the USD, while Kamala Harris was seen as the continuity candidate. "It is widely considered that a Trump win will be positive for the USD, though many feel this outcome has been discounted," noted Chris Weston, an analyst at broker Pepperstone. 

On the other hand, the Bank of England (BoE) is likely to cut interest rates on Thursday, despite forecasts that Labour’s budget could lead to higher inflation in the UK the next year. Money markets appeared confident that the BoE would announce the second 25 bps reduction of the year, lowering the policy rate to 4.75%.