As US non-farm payrolls data comes, GBP/USD faces resistance above 1.2900

In early Asian trading on Friday, GBP/USD remained on the defensive around 1.2895, the lowest since August 16. GBP/USD fluctuated lower following the release of the UK Labor government's first autumn forecast statement on Wednesday.

U.S. inflation, measured by the personal consumption expenditures price index (PCE), rose slightly faster than expected in September. Data released by the U.S. Bureau of Economic Analysis (BEA) on Thursday showed that the overall PCE annual rate increased by 2.1% in September and 2.2% in August, in line with the market consensus of 2.1%.

Core PCE, which excludes volatile food and energy prices, jumped 2.7% over the same period, matching August's gain and above market expectations of 2.6%. Financial markets expect the Fed to cut interest rates by 25 basis points (bps) at each of its two policy meetings in November and December, according to the CME FedWatch tool.

Investors will keep a close eye on Friday's U.S. nonfarm payrolls (NFP) data for October for fresh impetus. Non-agricultural employment is expected to be 113,000 in October, and the unemployment rate is expected to remain stable at 4.1%.

In the UK, the new British Labor government released its first budget on Wednesday, which included a 40 billion pound tax increase to plug holes in public finances and allow investment in public services.

In addition, the UK Office for Commercial Responsibility (OCR) raised its inflation forecast for 2024 to 2.5% from the 2.2% expected in early March. This adjustment also makes traders expect that the Bank of England (BOE) will cut interest rates. weaken. This, in turn, could prevent the pound from falling further.