The Sterling strengthened significantly against the US Dollar, as all the main components of the UK retail sales report showed better-than-expected figures for August. After the release, the GBP/USD jumped by 0.67% or 91 base point to touch the daily high of 1.3606 However, by the next couple of hours the pair resumed trading in a weaker area between the 1.3525 and 1.3560 marks.
The Office for National Statistics reported that both Britain's retail sales and core retail sales rose 1.0% in August, beating expectations for a 0.2% rise and ignoring rising prices brought by post-referendum weakness of the Sterling. Therefore, strong figures are likely to boost expectations for the Bank of England's rate hike announcement in November.
| Historical Data Table: UK Retail Sales | |||||
| Date | 18.05.2017 | 15.06.2017 | 20.07.2017 | 17.08.2017 | 20.09.2017 |
| Actual | 2.30% | -1.20% | 0.60% | 0.30% | 1.00% |
| Forecast | 1.20% | -0.90% | 0.40% | 0.20% | 0.20% |
| Initial Reaction on Main Pairs | |||||
| Open Price | Close Price | % Change | |||
| GBP/USD | 1.35156 | 1.36068 | 0.67% | ||
| EUR/GBP | 0.88845 | 0.88275 | -0.64% | ||
| GBP/CAD | 1.65902 | 1.66924 | 0.62% | ||
| GBP/JPY | 150.584 | 151.51 | 0.61% | ||