The British pound is lower against the US dollar for a fourth day as uncertainty around the UK’s trade negotiations with the EU weigh on Sterling while the dollar ploughs ahead thanks to strong US economic data and as the main beneficiary to Asian currency weakness following a cut to Chinese interest rates.

GBP/USD was lower by 55 pips (-0.42%) at 1.2865 with a daily price range of 1.2850 to 1.293 as of 3pm GMT. An attempt to rebound above 1.29 after an early drop failed and the currency pair slid further into the afternoon. Weekly losses now stand at -1.26%.

GBP/USD: Sterling tumbling against the US dollar

Anybody buying pounds in the past four days cannot catch a break. Sterling has been tumbling against the greenback despite some well-received economic data in the United Kingdom. The falls have been more established against the dollar thanks to equally strong data in the US, but the pound has been down against the euro too.

On Thursday, UK retail sales figures released for January was the best monthly performance since May 2018. UK retail sales grew 0.9% month-over-month in a complete turnaround from the -0.5% contraction in December. Any big-ticket purchases that might have been delayed because of the December UK seem to have been purchased in the January sales.

While the UK has set out a relatively clear vision for a Canada style FTA, the European Union is yet to define its own negotiating priorities. Statements this week that have harmed the pound because they imply the EU is still set in forcing the United Kingdom to align with its rules in via so-called “level playing field” objectives.

The dollar

The dollar gained throughout Thursday as data from the United States continued to impress. Manufacturing’s recovery from the contraction of the prior half year is the starkest. Today the Philly Fed manufacturing index came in at 36.7, well ahead of the 12 expected and 17 previously. The latest FOMC minutes demonstrated the Federal Reserve recognises the better US data and is content to keep the benchmark interest rate at the current level.

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