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The volume of British retail sales dropped by 0.2% in August. Estimates stood on a fall of 0.3%. Last month saw a rise of 0.3% according to the first release, before revisions.

GBP/USD fell under 1.62 earlier in the day but escaped the 1.6150 level and recovered. It is now making small gains.

Earlier this week, the UK reported that inflation is easing. It was better seen in the bigger drop in the Retail Price Index, but also CPI eased to 2.5%.

The global mood is worse after another negative Chinese manufacturing PMI, worsening conditions in Japan and the fact that Spain is still dragging its feet with asking for aid.

1.63 serves as strong resistance for the pair. 1.6110 is support. For more, see the British pound forecast.