More disappointing data from the UK: retail sales advanced only 0.1% in July, and core sales rose by 0.5%. UK consumers have not returned to shopping en masse following the slow growth in June. Also Public Sector Net Borrowing fell short, with -1.1 billion. This means that the government had a lower surplus.
GBP/USD is now sliding, erasing earlier gains and trading at 1.6570.
The United Kingdom was expected to report an advance of 0.4% in retail sales during July, after a modest rise of 0.2% in July (revised up from +0.1%).
GBP/USD traded around 1.6590 towards the publication, rising up from the lows.
The pound was pounded down in recent days. Despite seeing some MPC members vote for a rate hike for the first time since Carney assumed his position, sterling could not hold onto its gains. Weak inflation figures released earlier this week mean that there is time before the first rate hike.
Yet it’s not only the pound: the not-too-dovish FOMC meeting minutes gave a boost to the greenback, which was already fired up after some strong housing data. The pound could not withstand the strength and gave in.
For more, see the GBPUSD forecast.
Here is how the pound is moving on the chart:
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