UK Pound Soft due to Shop Price Deflation, Supported by Services PMI

The Great Britain pound was soft today as shop price deflation persisted last month, suggesting that the UK economy is not yet completely healthy. Losses were limited, though, as the services sector continued to demonstrate robust expansion.
British Retail Consortium reported that shop prices fell 1.4 percent in May, at the same rate as in the previous month. At the same time, the Markit/CIPS UK Services Purchasing Managers’ Index was at 58.6 in May, little change from April’s 58.7, showing strong growth of the sector. The Bank of England will conduct its monetary policy meeting tomorrow, and it is likely that the bank will keep the policy unchanged.
GBP/USD was down from 1.6748 to 1.6698 before trading at 1.6732 as of 10:23 GMT today. GBP/JPY traded near the opening level of 171.67 following the drop to 171.34.

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