Early on Thursday, GBP/USD is trading somewhat steady after sliding from its monthly high in the previous session even after the dollar strengthens in the wake of heightened uncertainty about the economic impact of the coronavirus pandemic. At the time of writing, GBP/USD is trading around 1.248.

The Cable had turned bullish over the past few sessions over a sense of cautious optimism that the pandemic was showing signs of peaking in the US and Europe. However, the market sentiment deteriorated and sent GBP/USD lower after the IMF forecast a global economic recession for this year, with the global economy expected to contract by as much as 3%.

GBP/USD also turned bearish after the US dollar strengthened as a safe haven currency over increasing worries about the extent of economic damage the pandemic could drive. While economists and analysts had initially predicted a sharp, V-shaped recovery, most of them now expect economic recovery to take longer.

Britain is expected to see its economy contract by as much as 13% this year on account of the extended shutdown enforced by the government in a bid to contain the spread of the virus. Public borrowing is expected to touch the highest levels seen since WWII as the government unveils severel stimulus measures to protect the economy.