When are the UK retail sales and how could they affect GBP/USD?

Dhwani Mehta FXStreet

UK Retail Sales Overview

The UK retail sales, scheduled to be published later this session at 0830 GMT, are expected to come in at 0.0% m/m in August, following a +0.2% figure seen in July. Total retail sales are seen arriving at 2.9% over the year in the reported month, down from 3.3% booked previously.

Meanwhile, core retail sales, stripping the basket off motor fuel sales, are seen flat (0.0%) m/m while rising 2.6% y/y.

Deviation impact on GBP/USD

Readers can find FX Street's proprietary deviation impact map of the event below. As observed the reaction is likely to remain confined between 10 and 70 pips in deviations up to 3.5 to -1.5, although in some cases, if notable enough, can fuel movements of up to 100 pips.

How could it affect GBP/USD?

FXStreet’s Analyst Anil Panchal notes: “… an upward sloping trend-line since September 12 still holds the downside confined around 1.2455, a break of which could call sellers targeting 1.2310/05 confluence that comprises 200-bar exponential moving average (EMA) and 38.2% Fibonacci retracement level of current month upside. However, 23.6% Fibonacci retracement level close to 1.2390 and September 05 high near 1.2355 could offer intermediate halts during the south-run. Alternatively, pair’s rise above latest high around 1.2530 paves the way for a fresh rally towards mid-July peak nearing 1.2580.”

However, the main market driver for the pound is likely to be the Bank of England (BOE) monetary policy decision due later today at 1100 GMT.

Key Notes

GBP/USD forecast: Bulls await a move beyond 100-DMA, UK data/BoE eyed for fresh impetus

GBP Futures: extra gains stay on the pipeline

Forex Today: Oct RBA rate cut calls hit Aussie; UK data BOE in spotlight

About the UK Retail Sales

The retail sales released by the Office for National Statistics (ONS) measures the total receipts of retail stores. Monthly per cent changes reflect the rate of changes in such sales. Changes in Retail Sales are widely followed as an indicator of consumer spending. Generally speaking, a high reading is seen as positive, or bullish for the GBP, while a low reading is seen as negative or bearish.

Author

Dhwani Mehta

FXStreet

Residing in Mumbai (India), Dhwani is a Senior Analyst and Manager of the Asian session at FXStreet. She has over 10 years of experience in analyzing and covering the global financial markets, with specialization in Forex and commodities markets.

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