GBP/USD clinches fresh 2024 highs above 1.2800 ahead of US NFP data

• GBP/USD attracts some buyers to a fresh 2024 high above 1.2800 on the weaker USD. 
• Fed Chair Powell said interest rate cuts may not be too far off if inflation signals cooperate. 
• Investors expect the BoE to lower interest rates after the Fed, which boost the Pound Sterling. 
• The US February labor market report will be a closely watched event. 

The GBP/USD pair holds ground above the 1.2800 psychological barrier during the early Asian trading hours on Friday. The selling pressure in the US Dollar (USD) provides some support to the major pair. The highlight on Friday will be the US labor market data for February. GBP/USD currently trades around 1.2810, up 0.01% on the day. 

The Federal Reserve (Fed) Chairman Jerome Powell presents the Monetary Policy Report and responds to questions before the Senate Banking Committee on Thursday. Powell said that interest rate cuts may not be too far off if inflation signals cooperate. Fed Chair didn’t provide a precise timetable for rate cuts but noted that the day could be coming soon. Investors expect the first cut to come in June, with four reductions totaling a full percentage point by the end of 2024.

On the other hand, the financial markets anticipate that the Bank of England (BoE) to lower interest rates after the Fed. This, in turn, boosts the Pound Sterling (GBP) and acts as a tailwind for the GBP/USD pair. Investors expect the BoE to start easing in the August meeting. Nonetheless, BoE policymakers will see more evidence of inflation before making a decision. 

Moving on, traders will keep an eye on the US February Nonfarm-Payrolls, Unemployment Rate, and Average Hourly Earning, due on Friday. These events could trigger volatility in the market. Market players will take cues from the data and find trading opportunities around the GBP/USD pair.