GBP/USD struggles to recoup the previous day's loss, hovering around 1.2410 during Friday's early Asian trading hours. The pair is experiencing downward pressure following the United States' (US) better-than-expected economic data.

As anticipated, the August Core Producer Price Index (PPI) increased by 2.2% on Thursday, which was below the previous rate of 2.4%. Compared to the previous month's 0.5% readings and the market consensus of a 0.2% decline, retail sales increased to 0.6%.

US Initial Jobless Claims for the week ending on September 8, printed the reading of 220K new claimants better than the forecast 225K. During the previous week, 217K copies were printed.

However, the CME FedWatch Tool has reduced the likelihood that the US Federal Reserve (Fed) will raise interest rates by 25 basis points (bps) in November to 35%. Investors become wary of the possibility of such a move as they assess the evolving economic outlook and Fed communications.

On Thursday, the US Dollar Index (DXY), which compares the US Dollar (USD) to the six other main currencies, reached its highest level in six months. The spot price is approximately 105.40 at the moment of this writing.

Following Wednesday's disappointing performance on the United Kingdom's (UK) economic calendar, the British Pound's (GBP) risk appetite remains dubious.

The UK's Gross Domestic Product (GDP) fell by 0.5% in July, exceeding expectations of a 0.2% decline and erasing the 0.5% increase from the previous month. This unanticipated GDP contraction has increased GBP volatility and market unpredictability.

As a result of the Bank of England's (BoE) tight posture on interest rates, the British economy faces a number of difficulties. These obstacles consist of exceptionally resilient wage growth and a labour market where demand is exhibiting signs of deceleration.

As a result, the economic outlook for the United Kingdom has become tenuous, as the nation's total production is contracting in the context of weakening demand. Given the BoE's intentions for additional interest rate hikes, the likelihood of the UK economy falling into a technical recession is high.

Friday will presumably see the release of the preliminary Michigan Consumer Sentiment Index in the United States. This index is anticipated to register a minor decline from 69.1 to 69.5. If the actual reading matches or exceeds these expectations, it has the potential to provide the Greenback with the necessary momentum to continue its ascent.

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