The UK retail sales came in better than expected, shrugging off the Brexit uncertainty in the market. How did GBPUSD react on the data release?
18 August AtoZForex — Following the stable UK unemployment figures shown yesterday at 4.9%, as well as a fall in claimants count change, the retail sales report for the country is due today. Being a primary gauge of consumer spending, this will be closely watched. Furthermore, the data will indicate how the Brexit impact on consumers.
As the analysts forecasted the UK retail sales at 0.1% change, the UK retail sales came in better than expected, shrugging off the Brexit uncertainty:
– UK retail sales month-on-month soared 1.4% last month
– July’s reading has beaten the market forecast of 0.1%
– The retail sales data has rebounded from previous reading of -0.9%
How did GBPUSD react after the UK retail sales release?
What does this mean? It indicates that the market has shrugged off some of the Brexit uncertainty and fears. As a result GBPUSD surged roughly 100 pips, reaching a level of 1.31500.
The UK retail sales add to the mixed economic releases that have been published so far. Post the Brexit vote, it is not clear yet how the UK economy will be affected by the historic EU referendum. Earlier this month, the Bank of England (BoE) cut the interest rates to the historic low at 0.25 percent, while the BoE resumed its quantitative easing. Actions that are part of the bank’s stimulus package, in order to protect the UK economy from a market shock post the Brexit vote.
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