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GBP/USD Pair Shows Resilience: A Look at the European Session

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Amidst the European trading session on Friday, the GBP/USD pair has garnered noticeable buying interest. Following an initial downturn post the US unemployment claims, both the GBP/USD and EUR/USD pairs are displaying an upward trajectory.

One significant contributing factor to this dynamic is the prevailing risk-on sentiment, which is diminishing the US Dollar's appeal as a safe-haven asset. Consequently, this shift is offering some support to the GBP/USD pair.

Further bolstering the British Pound's position is the Bank of England's (BoE) stance against premature interest rate cuts, as indicated by policymakers. This stance adds to the positive sentiment surrounding the GBP/USD pair. However, in contrast, the growing consensus that the Federal Reserve (Fed) will postpone interest rate adjustments until the June policy meeting, coupled with hawkish remarks from various FOMC officials, is reinforcing higher US Treasury bond yields. Consequently, this acts as a tailwind for the US Dollar, restraining bullish sentiment surrounding the GBP/USD pair.

Looking ahead, market participants are eagerly anticipating the release of the final UK Manufacturing Purchasing Managers' Index (PMI). Additionally, a scheduled speech by the BoE Chief Economist, Huw Pill, is expected to provide further market direction.

In conclusion, the current market outlook suggests a bullish setup for the GBP/USD pair, driven by a combination of factors including prevailing sentiment, central bank policy stances, and forthcoming economic data releases.