GBP/USD consolidates daily losses near 1.2330

• GBP/USD finds support below 1.2300, looks to post daily losses.
• UK expects coronavirus to circulate for a long time.
• PM Johnson says different parts of UK could stay in lockdown longer.

The GBP/USD pair stayed relatively quiet above 1.2400 at the start of the week but came under strong bearish pressure during the European trading hours. After dropping to a fresh four-day low of 1.2284 with the GBP weakening on coronavirus concerns, the pair staged a technical recovery but remains on track to close the day in the negative territory. As of writing, GBP/USD was down 0.64% on the day at 1.2328.

In its recovery-strategy published on Monday, the UK government noted that the coronavirus is expected to circulate for a long time with periodıic epidemics. "Governments financial support measures are extraordinarily expensive and cannot be sustained for a prolonged period of time," the publication read. 

Moreover, British Prime Minister Boris Johnson said different part of the UK may need to stay in lockdown longer and acknowledged that a "wrong move" would be disastrous. "If data goes the wrong way, we will have no hesitation in reintroducing measures," Johnson added. 

Focus shifts to UK GDP data

On the other hand, the greenback capitalized on the cautious market mood and caused the bearish pressure to remain intact. The US Dollar Index (DXY) erased the losses it suffered in the second half of the previous week on Monday and was last seen gaining 1.2% on the day at 100.27.

Tuesday's economic docket won't be featuring any macroeconomic data releases from the UK. The Consumer Price Index (CPI) will be released from the US later in the day. On Wednesday, investors will be keeping a close eye on the preliminary first-quarter GDP data from the UK.

Previewing the data, “a wide range of -1.6% to -2.4% can be considered within estimates," said FXStreet analyst Yohay Elam. “A quarterly contraction of -2.5% or worse would already trigger headlines screaming ‘worst than the crisis’ alongside ‘this is only the beginning.’ Such depressing figures early on could send sterling tumbling down.”