Photo by Colin Watts on Unsplash 
 

• GBP/USD chalked in a third straight gain on Thursday, recovering 1.3500.
• US PCE inflation lies ahead on Friday, and global markets have fingers crossed for a not-too-hot print.
• Investors need inflation figures to remain under control to buy a Fed rate cut in September.

GBP/USD marched its way into a third consecutive bullish session on Thursday, climbing back over the 1.3500 handle and paring away most of the early-week losses from Monday’s half-percent decline. Cable remains firmly entrenched in recent consolidation, but markets are positioning themselves for an upside reaction after Friday’s upcoming US Personal Consumption Expenditures Price Index (PCE) inflation print.

GBP/USD is tilting into the bullish side after skidding across the 50-day Exponential Moving Average (EMA) near 1.3455 over the past couple of weeks. Cable still remains over 2% down from multi-year highs posted in July, but has climbed 2.8% from four-month lows near 1.3140.

US PCE inflation to dominate markets on Friday
 

It’s all eyes on the US data docket on Friday. US PCE inflation for the year ended in July is expected to tick upwards to 2.9% YoY, and investors have their fingers crossed that US inflation will remain under control enough for the Federal Reserve (Fed) to be pushed by lagging employment figures into delivering an interest rate cut on September 17. Core annual US PCE inflation has run above the Fed’s 2% inflation target every single month since April 2021, and has functionally made no progress since July of 2024.

GBP/USD daily chart
 

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