GBP/USD remains confined in a range above 1.3400 as traders eye US PCE and GDP data

• GBP/USD struggles to gain any meaningful traction for the second straight day on Thursday.
• Easing trade war fears assist the USD to attract some follow-through buyers and cap the pair.
• Traders now look forward to the US PCE Price Index and the US Q3 GDP for a fresh impetus.

The GBP/USD pair extends its sideways consolidative price move for the second straight day on Thursday and oscillates in a range above the 1.3400 mark during the Asian session. Moreover, a mixed fundamental backdrop warrants some caution before placing directional bets as traders keenly await the crucial US macro data.

The US Personal Consumption Expenditure (PCE) Price Index is due for release later today. It will be accompanied by the final US Q3 GDP growth report, which should offer fresh cues about the US Federal Reserve's (Fed) future policy path. This, in turn, will play a key role in influencing the near-term US Dollar (USD) price dynamics and provide some meaningful impetus to the GBP/USD pair.

In the meantime, the USD is seen gaining some follow-through positive traction and building on the previous day's move up in the wake of easing tensions over Greenland. In fact, US President Donald withdrew a threat to impose tariffs on a number of European ‌nations and said in Davos on Wednesday that he had reached an agreement on a framework for a future deal on Greenland with NATO.

The comments eased trade war fears, which had revived the so-called 'Sell America' trade. Adding to this, reduced bets for a more aggressive easing by the Fed offer some support to the USD and act as a headwind for the GBP/USD pair. The British Pound (GBP), on the other hand, struggles to lure buyers amid mixed expectations about future interest rate cuts by the Bank of England (BoE).

The UK Office of National Statistics reported on Wednesday that the headline Consumer Price Index (CPI) rose for the first time in five months, to the 3.4% YoY rate in December. The data make it unlikely that the BoE will lower borrowing costs at its policy meeting early next month. Traders, however, are still pricing in one or possibly two quarter-point interest rate cuts by the BoE in 2026.

This, in turn, holds back traders from placing aggressive bets around the GBP/USD pair and contributes to the subdued range-bound price action. From a technical perspective, spot prices, so far, have managed to hold above the very important 200-day Simple Moving Average (SMA). The said SMA is currently pegged near the 1.3365-1.3360 region and should now act as a key pivotal point for traders.