GBP/USD trades with negative bias around 1.2425 area, US NFP report awaited

• GBP/USD remains depressed for the second straight day amid the BoE's dovish outlook.
• The BoE cut interest rates by 25 bps on Thursday and signaled further rate cuts this year. 
• Subdued USD price action helps limit the downside ahead of the crucial US NFP report.

The GBP/USD pair struggles to capitalize on the overnight bounce from a multi-day low and trades with a mild negative bias, around the 1.2425 area during the Asian session on Friday. This marks the second straight day of a downtick, though it lacks follow-through as traders seem reluctant to place aggressive bets and opt to wait for the release of the US monthly jobs data. 

The popularly known Nonfarm Payrolls (NFP) report is expected to show that the world's largest economy added 170K jobs in December, down from 256K in the previous month. Meanwhile, the Unemployment Rate is expected to hold steady at 4.1%. This, along with Average Weekly Earnings, 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. 

Heading into the key data risk, expectations that the Federal Reserve (Fed) will stick to its easing bias and lower borrowing costs twice by the end of this year keep the US Treasury bond yields depressed near their lowest level since December. This, in turn, fails to assist the USD to attract any meaningful buyers and might act as a tailwind for the GBP/USD pair, though the Bank of England's (BoE) gloomy outlook should cap the upside. 

In fact, the UK central bank lowered its benchmark interest rate by 25 basis points on Thursday and downgraded the growth forecast for 2025. Adding to this, BoE Governor Andrew Bailey told reporters that the central bank expects to make further rate cuts this year. This might continue to undermine the British Pound (GBP) and suggests that the path of least resistance for the GBP/USD pair remains to the downside.