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

UK retail sales Overview

The UK retail sales, scheduled to be published later this session at 0830 GMT, are expected to drop 0.2% m/m in August, following an increase of 0.7% in July. Total retail sales are seen rising 2.3% over the year, down from 3.5% in July. Meanwhile, core retail sales, stripping the basket off motor fuel sales, are seen dropping 0.2% m/m while rising 2.5% 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 Haresh Menghani notes: “A follow-through weakness below the 1.3100 handle will reinforce the expectations and turn the pair vulnerable to head towards testing the 1.3060-50 intermediate support before eventually sliding back towards the key 1.30 psychological mark.”

“However, technical indicators on the mentioned chart are still holding in bullish territory. Hence, a sustained move beyond the 1.3200 handle would invalidate the negative outlook and pave the way for an extension of the pair's near-term upward trajectory further towards reclaiming the 1.3300 round figure mark,” Haresh adds.

Key Notes

GBP/JPY Forecast: Rally stalled at 7-month downtrend line, eyes UK retail sales

Market themes of the Day: UK retail sales and Salzburg meeting headline

UK: Expect no change in retail sales for August - TDS

About the UK retail sales

The Retail Sales released by the Office for National Statistics (ONS) measures the total receipts of retail stores. Monthly percent 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.