UK retail sales fell by 0.9% in August. They were expected to rise by 0.4% in August after a strong gain of 1.1% in July. Recent UK data was excellent so this downfall is quite surprising.
GBP/USD was one of the big winners of the FOMC decision NOT to taper, with the pair reaching high ground above 1.61. Minutes before the publication, the pair dropped a bit. It now extends its drops and falls towards 1.6080.
Update: the disappointment in this major indicator offers an opportunity for cable to consolidate its gains, and it dips below 1.6080 – a ~40 pip fall from the pre-release levels. It’s important to note that the slide from even higher levels than 1.6120 began before the publication.
The British economy is on the roll according to recent data. The Bank of England upgraded the economic forecasts and even mentioned that rapid increases in house prices could be worrying.
The big levels to watch are 1.60 on the downside and 1.63 on the top, as cable trades at levels last seen in January. Here is an updated analysis of the technical levels facing GBP/USD after shooting higher.
