GBPUSD extended its decline to near 1.3195 during Friday’s Asian session, weighed down by growing expectations of a Bank of England (BoE) rate cut next week. With UK inflation pressures easing and labor market conditions softening, analysts anticipate a 25 bps rate cut on August 7, following a similar move in May. Money markets now price in an 89% chance of easing. Meanwhile, the US Dollar gained support from fresh tariffs imposed by President Trump on multiple trade partners, including a hike on Canadian goods from 25% to 35%. However, traders remain cautious ahead of the U.S. Nonfarm Payrolls data. A weaker-than-expected report could dent USD strength and offer near-term support to the Pound, temporarily easing selling pressure on GBPUSD.

London equities ended on a higher note on Thursday. The FTSE 100 index finished down 46.38 points at 9,086.43. The FTSE 250 ended 155.51 points higher at 21,888.98, while the AIM All-Share closed 0.33 points down at 761.17. The Cboe UK 100 ended 0.66% lower at 906.82, the Cboe UK 250 closed 0.31% higher at 19227.73, and the Cboe Small Companies ended higher at 17404.97.