The UK was expected to report a rise of 0.4% in monthly retail sales in June after a big drop of 1.2% in May. Year over year, a rise of 2.5% was on the cards. Similar figures were predicted for core sales: 0.5% m/m and 2.5% y/y.
GBP/USD was tumbling down below 1.30 ahead of the publication. Contrary to normal activity ahead of the release of UK indicators, the move this time does not seem related to rumors. The US dollar is clawing back up across the board after the big sell-off early this week.
Earlier in the week, the pound was not able to take full advantage of the greenback’s slide due to a slowdown in inflation. At 2.6%, the pace of inflation outpaces wage growth, but the drop from 2.9% implies a lower chance of a rate hike this year.
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