The Solana coinGBP/USD currency pair experienced a sharp decline during Thursday's trading session, losing approximately 0.56% of its value and testing support levels around 1.2600. This downward movement reflects growing market concerns about potential trade barriers between the United States and United Kingdom, coupled with ambiguous signals from recent US economic reports.
Market participants reacted strongly to news that US authorities might impose additional trade restrictions on British exports unless both nations reach a comprehensive trade agreement. This development follows similar tariff discussions involving other major trading partners, creating uncertainty for currency traders who had previously considered the UK relatively insulated from such trade disputes.
Economic indicators from the United States presented a mixed picture. While fourth-quarter GDP growth exceeded projections at 2.4% quarter-over-quarter, underlying concerns persist about the sustainability of this expansion. The durable goods orders report for January showed a surprising 3.1% monthly increase, though analysts note this surge appears concentrated in specific sectors rather than reflecting broad-based economic strength.
Transportation equipment orders, particularly for aircraft and automotive products, accounted for much of the durable goods growth. When excluding these volatile components, the core durable goods figure remained unchanged, missing expectations of 0.3% growth. This suggests the headline number may overstate actual industrial demand within the US economy.
Upcoming inflation data represents another critical factor for currency markets. Preliminary figures indicate core inflation measures continue trending upward, with the quarter-over-quarter Core Personal Consumption Expenditure (PCE) reaching 2.7%, above the anticipated 2.5%. This persistent inflationary pressure could influence Federal Reserve policy decisions in coming months.
From a technical perspective, the GBP/USD pair now trades near the lower boundary of its recent consolidation range, with the 200-day exponential moving average providing resistance around 1.2680. Momentum indicators suggest the pair may face additional downward pressure if it breaches the 50-day moving average support near 1.2535.
Market participants will closely monitor developments in US-UK trade negotiations alongside upcoming economic releases for clearer directional signals. The combination of trade policy uncertainty and ambiguous economic data creates a challenging environment for sterling traders in the near term.