Prior to the release of UK GDP and US PCE Inflation figures, the GBP/USD has found a temporary resting place near 1.1200

Price action for GBP/USD on Friday's Asian session has seen it range between 1.1160 to 1.1555 as buyers prepare for the first weekly advance in three weeks. As a result, the cable pair is benefiting from the general weakness of the US dollar and the ambiguous outlook on the US dollar before to the release of important data from the UK and the US.

In a recent interview, UK Trade Secretary Kemi Badenoch said that the chancellor and the Bank of England are "working well" together.

As a result, the GBP/USD exchange rate is supported by expectations of a robust rate hike cycle from the Bank of England, or "Old Lady."

As a counterpoint, the US Dollar Index (DXY) has remained in the red at around 111.90, snapping a two-week uptrend. By this metric, the Fed's recent strong rhetoric and the widespread recession fears in the face of lowering inflation expectations are not justified by the dollar's performance against the six major currencies. Important for dollar traders today is the August Core PCE Price Index, which is expected to be 4.7% YoY, the same as the previous reading.

Final readings of the UK's Gross Domestic Product (GDP) for the second quarter (Q2) are expected to corroborate initial forecasts of -0.1%, making them important to track.

If incoming data verifies the projections, the GBP/USD could pare recent gains, which would be appropriate given the optimistic inflation estimates and fears of a UK economic downturn.

A significant break above a two-week-old resistance line, now support around 1.1035, is needed to keep GBP/USD investors upbeat, as is a move above the 100-day exponential moving average (EMA) surrounding the 1.1200 level. When the RSI reaches the overbought area, it usually means that further gains will be capped.