• The Pound Sterling declines against the US Dollar to nearly 1.2880 amid dismal market sentiment ahead of advanced US Q2 GDP data.
• Firm preliminary S&P Global/CIPS PMI for July has improved the UK’s economic outlook.
• BoE officials hesitate to authenticate market speculation for a rate cut in August.

The Pound Sterling (GBP) weakens to 1.2880 against the US Dollar (USD) in Thursday’s London session. The GBP/USD pair declines on sour market sentiment ahead of the advanced United States (US) Q2 Gross Domestic Product (GDP) data, which will be published at 12:30 GMT. 

S&P 500 futures posted some gains in European trading hours, but this appears to be a slight pullback move after nosediving by 2.31% on Wednesday. The US Dollar Index (DXY), which tracks the Greenback’s value against six major currencies, exhibits a sluggish performance at around 104.30.

The US Q2 GDP is estimated to have grown by 2% from the former release of 1.4% on an annualized basis. A higher growth rate is expected to result from strong consumer spending. Per the consensus, the advanced GDP Price Index is expected to have decelerated to 2.6% from the prior reading of 3.1%, which would bring relief for Federal Reserve (Fed) policymakers and cement expectations of interest rate cuts in September.

Going forward, the major trigger for the US Dollar will be the Personal Consumption Expenditures Price Index (PCE) data for June, which will be published on Friday. The core PCE inflation, the Fed’s preferred inflation gauge, is estimated to have decelerated to 2.5% from May’s figure of 2.6%, with the monthly figure growing steadily by 0.1%.