GBP/USD drops below 1.3000 on UK Retail Sales

• Cable breaches 1.3000, posting fresh 2018 lows.
• The pair accelerates the downside in the wake of poor data.
• Headline Retail Sales contracted 0.5% MoM during June.

The Sterling came under further selling pressure on Thursday and is now dragging GBP/USD to the area of fresh 2018 lows in sub-1.3000 levels.

GBP/USD weaker on data

Cable gathered extra downside pressure to the 1.2990 region after UK’s Retail Sales came in below expectations for the month of June.

In fact, headline sales contracted at a monthly 0.5% (vs. 0.1% gain forecasted) and expanded at an annualized 2.9% from May’s 4.1% (revised from 3.9%). In the same line, Core sales dropped 0.6% inter-month and advanced 3.0% over the last twelve months.

In the meantime, disappointing data, omnipresent Brexit jitters and political uncertainty (fragility?) around May’s government remain poised to keep the British Pound under heavy pressure in the domestic front, while the robust rally in the buck intensifies the selling bias in spot.

GBP/USD levels to consider

As of writing, the pair is losing 0.51% at 1.3003 and a break below 1.2984 (2018 low Jul.19) would open the door to 1.2979 (low Oct.6 2017) and finally 1.2771 (monthly low Aug.25 2017). On the flip side, the next hurdle lines up at 1.3196 (21-day sma) followed by 1.3295 (high Jul.16) and then 1.3318 (55-day sma).