GBP/USD rises 0.4% on UK growth resilience despite economic headwinds

GBP/USD advanced 0.4% to 1.2580 as sterling found support from signs of economic resilience despite ongoing UK economic challenges. The pound's rally came amid market reassessment of UK growth prospects, with recent data suggesting the economy is weathering current headwinds better than anticipated. While overall economic activity remains sluggish, pockets of strength in services and consumer spending have provided sterling with a foundation for gains. The US Dollar Index retreated 0.3% to 107.85, further supporting cable's upward momentum. Technical indicators show GBP/USD breaking above the 1.2550 resistance level, opening the path toward 1.2620. The 50-day moving average at 1.2520 now acts as immediate support. Traders remain cautious ahead of next week's UK inflation data, which could influence Bank of England rate expectations and determine whether sterling's recovery has legs.