GBP/USD Edges Higher as US Retail Sales Disappoint

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The GBP/USD pair is trading with modest gains around 1.2585 during the early Asian session on Monday. The pair is edging higher, supported by a stronger-than-expected UK GDP report and weaker-than-forecast US Retail Sales data. US markets are closed on Monday for President’s Day.

US Retail Sales experienced their largest drop in nearly two years, contributing to a weaker US dollar. Retail Sales fell 0.9% in January, following a revised 0.7% increase in December, according to the US Census Bureau. This decline was worse than the expected 0.1% drop. On a yearly basis, Retail Sales were up 4.2%.

The positive UK GDP report helped support the British pound. The UK economy grew by 0.1% quarter-over-quarter in Q4 2024, surpassing expectations, based on preliminary data from the UK Office for National Statistics.

Traders will be watching the upcoming UK labor market and Consumer Price Index (CPI) inflation reports on Tuesday and Wednesday, respectively. These data points could provide clues as to whether the Bank of England will implement another interest rate cut in its March meeting.

 

 

 

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