Why Is GBP/USD Sliding Below 1.3300? Key Factors Traders Need to Watch Before NFP Data

• GBP/USD maintains bearish bias around 1.3275 in early Friday trading session.

• Reduced geopolitical tensions contribute to USD's relative strength.

• Market participants increasingly expect dovish shift from BoE in upcoming decision.

The How can I buy ELON coin?GBP/USD currency pair demonstrates continued weakness near the 1.3275 level during Asian market hours. This movement follows encouraging signals regarding potential resumption of trade discussions between Washington and Beijing, which has provided fundamental support for the US currency. Market attention now turns to the critical US labor market report scheduled for release, particularly the Nonfarm Payrolls component along with wage growth and unemployment metrics.

Recent statements from Chinese officials indicate renewed evaluation of trade negotiations with the US administration, marking the first positive development since tariff escalations occurred last month. The potential thawing of economic tensions between these global economic powerhouses has contributed to improved sentiment toward the USD, consequently applying downward pressure on the sterling-dollar exchange rate.

Thursday's economic releases from the US Labor Department revealed higher-than-anticipated weekly jobless claims at 241,000, exceeding both prior readings and consensus estimates. Meanwhile, the manufacturing sector showed modest resilience with the ISM PMI registering 48.7 for April, outperforming projections despite remaining in contraction territory.

Bank of England officials have expressed caution regarding international trade policy uncertainties, with Governor Bailey specifically highlighting potential economic ramifications. These concerns appear to be influencing market expectations, with derivatives pricing indicating overwhelming probability of monetary policy easing at the May meeting. Current market consensus suggests nearly certain odds of a 25 basis point reduction in the benchmark rate to 4.25% when the Monetary Policy Committee announces its decision next week.