Anna 
In Friday’s London session, the Pound Sterling (GBP) faces vulnerability against the US Dollar (USD) amidst prevailing bearish market sentiment. The GBP/USD pair struggles to find support, with growing expectations of a Bank of England (BoE) interest rate cut this year overshadowing February’s Retail Sales data, which largely surpassed market expectations.
According to the United Kingdom Office for National Statistics (ONS), monthly Retail Sales remained unchanged after a significant 3.6% surge in January, a figure revised upward from 3.4%. Contrary to market anticipation of a 0.3% decline, sales held steady. However, on an annual basis, sales contracted by 0.5%, disappointing expectations of a 0.7% decrease.
Retail Sales data serves as a crucial indicator of current consumer spending trends, a significant component of the economy. While sales at retail stores slightly outperformed forecasts, they fall short of offsetting the prevailing risk-aversion sentiment in the global market.
The modest decline in Retail Sales appears insufficient to counterbalance the impact of heightened expectations for a Bank of England (BoE) interest rate cut starting in August. Additionally, concerns persist among BoE policymakers regarding elevated wage growth, as they endeavor to steer inflation toward the 2% target.
