GBP/USD clings to gains near 1-1/2 week highs, above mid-1.2500s

The GBP/USD pair remained well bid for the fourth consecutive session and touched a 2-1/2 week high level, albeit has now retreated few pips to currently trade around mid-1.2500s. 

Spot prolonged its recovery move from three-week lows touched at the beginning of this week, led by upbeat incoming UK economic data. The latest UK CPI print continues to point towards inflationary pressure, which coupled with yesterday's strong average weekly earnings growth data remains has been supportive of the pair's recovery back above the 1.25 handle.

On the other hand, a fresh bout of intense selling pressure surrounding the greenback, led by overnight remarks by the US President Donald Trump that the US currency is too strong further collaborated to the pair's up-surge to fresh monthly tops. 

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However, a minor greenback recovery, with the key US Dollar Index sneaking back above the 100.00 psychological mark seems to have prompted some profit taking following over 200-pips over the past few trading sessions. 

Today's economic docket features the release of BOE's credit conditions survey during European session, while from the US the release of latest PPI print, usual weekly jobless claims and Prelim UoM Consumer Sentiment Index are due for release later during the NA session.

Technical levels to watch

A follow through retracement below 1.2535 level might trigger additional profit taking slide towards the 1.25 handle, which is closely followed by support near 1.2485-80 area. On the upside, momentum above 1.2575 level (session top) should lift the pair beyond the 1.2600 handle towards testing March monthly highs resistance near the 1.2615 region.