GBP/USD off lows, still weaker around 1.2460 level

Having reversed tepid recovery gains beyond 1.25 mark, the GBP/USD pair dropped to 1.2440 region before bouncing off lows and is currently trading around 1.2460-65 band.

The pair's bounce during mid-European session, in wake of better-than-expected UK manufacturing & industrial production data, turned out to be short-lived. The major ran through fresh offers near 1.2520 level amid persistent US Dollar strength led by Trump's promise on Thursday to announce a “phenomenal” tax plan in coming weeks.

Spot accelerate the downslide on news report that UK's Liberal Democrats were looking to detail two amendments in the House of Lords to the Brexit bill. The selling pressure, however, abated just above 50-day SMA strong support near 1.2435 region, assisting the pair to recover few pips from session through. 

Meanwhile, data released from the US showed that the cost of imported goods surged in January for the third time in four months, rising 0.4% m-o-m after a revised 0.5% gain in December. Against the backdrop of Trump's expected pro-growth policies, the data supported expectations of higher inflationary pressure in the US economy and helped the greenback to hold on to strong daily gains. 

Next on tap from the US economic docket would be the release of Prelim UoM Consumer Sentiment index for the month of February.

Technical outlook

Valeria Bednarik, Chief Analyst at FXStreet notes, "the Pound is being quite reluctant to dollar's ongoing strength, which means that only above 1.2535, a Fibonacci resistance, the pair can gather some upward momentum and retest the mentioned high."

"Renewed selling pressure below 1.2470 on the other hand, should lead to further declines, with 1.2430 and 1.2390 as the next supports and probable bearish targets."