The British pound today rallied higher against the US dollar following the release of the latest UK retail sales data in the early European session, which beat expectations. The GBP/USD currency pair hit new 2-month highs following today’s releases and the weaker US dollar, but remains susceptible to Brexit headlines.
The GBP/USD currency pair today rallied from an Asian session low of 1.3138 to a 2-month high of 1.3233 in the mid-European session.
The currency pair was in a consolidative phase during the Asian session, but begun rallying higher in the early European session as investor sentiment towards the Sterling shifted. Th release of the upbeat UK retail sales data for August by the Office for National Statistics further fueled the pair’s rally to new highs. Headline retail sales grew by 0.3% in August, which was quite surprising given the consensus estimate of a 0.2% contraction. The core retail sales also grew by 0.3% versus the expected 0.3% decline, which translated into an annualized 3.5%, beating consensus estimates by a margin of 1.2%.
Despite the cable’s current rally, the pound still remains highly susceptible to Brexit headlines, which have been a major driver of the action in the pair. The pair also benefited from the greenback’s weakness as tracked by the US Dollar Index, which hit a low of 94.23.
The currency pair’s short-term performance is likely to be affected by the release of the Philly Fed Business Outlook and the US jobless claims data later today.
The GBP/USD currency pair was trading at 1.3228 as at 10:46 GMT having rallied from a low of 1.3138. The GBP/JPY currency pair was trading at 148.45 having risen from a low of 147.34.
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