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Market reports
Thanim Islam
  • GBP bounces off higher retails sales
  • Tories suffer political blow
  • Quiet rest of day ahead of rate decisions next week


Solid numbers from the US continued the gains on USD with initial jobless showing a strong labour market. Stocks dropped as well after Netflix Inc issued a disappointing revenue forecast representing a drop in risk appetite, which also benefited USD. EUR and GBP both continued their moves lower.

Whilst this may not be an immediate concern for markets with regards to GBP, by-election results this morning showed the Conservatives suffered a political upset by losing one special election to Labour and another to the Liberal Democrats. Reports suggest that Rishi Sunak is considering holding a general election in November 2024.

Retails sales for June this morning came in higher at 0.7%, higher than the expected 0.2%. GBP has caught a bid early this morning.


Market rates

* Daily move - against G10 rates at 7:30am, 21.07.23

** Indicative rates - interbank rates at 7:30am, 21.07.23

Data points


  • None today.

Our thoughts

Quiet rest of day with only the Canadian retail sales numbers. The stronger retail sales numbers for the UK will likely cause GBP to drift higher today, but overall the currency is set to have its worst week since March. The overall theme of USDgaining this week should continue today as well.

We have a busy diary next week with monetary policy meetings from the Fed, Bank of Japan, and the European Central Bank. For the UK, the major data points will be on Monday with the services and manufacturing PMIs.

Chart of the day

UK retails sales remain resilient in the face of high inflation and higher borrowing costs. But, its worth noting the full effect of higher interest rates is yet to take effect on the economy, with households likely needing to readjust their spending with the recent surge in mortgage rates. Consumer confidence recently fell to the lowest since April – levels seen during the recession in 2019/2020, 2008, and the 90’s. The mood may well be good now with spending but this may sour in months to come.

Source: Bloomberg Finance L.P.

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