GBP/USD consolidates around 1.3500; looks to US macro data for fresh impetus

The GBP/USD pair oscillates in a narrow range, around the 1.3500 psychological mark during the Asian session on Wednesday, and for now, seems to have stalled the previous day's retracement slide from its highest level since September 18. Moreover, the fundamental backdrop seems tilted in favor of bullish traders and suggests that the path of least resistance for spot prices is to the upside.

The US Dollar (USD) preserves the overnight gains, though it lacks bullish conviction on the back of dovish US Federal Reserve (Fed) expectations and ahead of a host of key macroeconomic indicators. Apart from this, the prevalent bullish sentiment across the global equity markets undermines demand for the safe-haven Greenback, which, in turn, is seen as a key factor acting as a tailwind for the GBP/USD pair.

The British Pound (GBP), on the other hand, continues to draw support from easing worries over the UK budget and a relatively hawkish Bank of England (BoE). The 5–4 narrow vote split to cut rates in December pointed to differences within the committee amid the recent inflation surprise, forcing investors to scale back their expectations for more aggressive easing in 2026. This could further support the GBP/USD pair.

The supportive factors validate the near-term positive outlook for the currency pair, though traders opt to wait for more cues about the Fed's rate-cut path. Hence, the focus remains on the US Nonfarm Payrolls (NFP) report on Friday. In the meantime, Thursday's release of the ADP report on the US private-sector employment, the US ISM Services, and JOLTS Job Openings might provide some impetus to the GBP/USD pair.