The GBP/USD currency pair rallied higher today after the release of strong UK retail sales data for the month of February by the Office for National Statistics. The British pound rallied higher boosted by the positive retail sales data as opposed to the weaker US dollar as investors exercised caution towards the greenback ahead of crucial House vote.
The currency pair gained over 50 points at the peak of its rally, but had retraced some of its gains at the time of writing.
The currency pair’s rally was triggered by the release of the UK retail sales data that exceeded expectations by posting an annualized increase of 3.7% versus the expected 2.6%. However, the quarter-to-quarter change decreased by 1.4% for the second consecutive month, which was the largest decrease since march 2010.
The currency pair was also affected by the US weekly jobless claims data, which recorded an increase to 258,000 as opposed to the expected 240,000. However, the jobless claims data was off-set by the new home sales data for February, which was recorded at 592,000 versus the expected 566,000. Furthermore, this positive data did little to boost the greenback.
The currency pair is likely to be affected by the House vote on Donald Trump‘s American Healthcare Act later today, which is likely to set the precedent for the implementation of Trump’s fiscal policies.
The GBP/USD was trading at 1.2526 as at 16:55 GMT having rallied from a low of 1.2460 prior to the release. The EUR/GBP was trading at 0.8611 having dropped from a high of 0.8650 earlier today.
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