{"id":4168,"date":"2017-12-15T00:00:00","date_gmt":"2017-12-15T05:00:00","guid":{"rendered":"https:\/\/currencylive.com\/100272-gbp-usd-uk-us-retail-sales\/"},"modified":"2017-12-15T00:00:00","modified_gmt":"2017-12-15T05:00:00","slug":"100272-gbp-usd-uk-us-retail-sales","status":"publish","type":"post","link":"https:\/\/currencylive.com\/news\/100272-gbp-usd-uk-us-retail-sales\/","title":{"rendered":"GBP\/USD: Both US & UK Retail Sales Impress"},"content":{"rendered":"

Retail sales, central bank decisions and tax reform news meant Thursday was a volatile session for the pound US dollar exchange rate. The pound US dollar rate traded an 85-point range hitting a weekly high of US$1.3460 for the pound, before moving lower.<\/p>\n\n\n\n\n\n
What do these figures mean? <\/th>\n<\/tr>\n<\/thead>\n
\n

When measuring the value of a pair of currencies, one set equals 1 unit and the other shows the current equivalent. As the market moves, the amount will vary from minute to minute. <\/p>\n

For example, it could be written: 1 GBP = 1.28934 USD<\/em> <\/p>\n

Here, \u00a31 is equivalent to approximately $1.29. This specifically measures the pound\u2019s worth against the dollar. If the US dollar amount increases in this pairing, it\u2019s positive for the pound.<\/em> <\/p>\n

Or, if you were looking at it the other way around: 1 USD = 0.77786 GBP<\/em> <\/p>\n

In this example, $1 is equivalent to approximately \u00a30.78. This measures the US dollar\u2019s worth versus the British pound. If the sterling number gets larger, it\u2019s good news for the dollar.<\/em> <\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table class=\"table table-bordered\">\n

UK retail sales data boosted investors\u2019 mood towards the pound in the previous session. Figures showed that the UK consumer continued to hit the shops in November, despite increasing prices and lower wages in real terms. Retail sales increased 1.5% year on year, much higher than analysts\u2019 forecasts of 0.2% and well above October\u2019s revised figure of 0%. This increase is most likely down to Black Friday shopping, when consumers hit the shops hard to pick up bargains before Christmas. The strong data boosted the pound.<\/p>\n\n\n\n\n\n
Why does strong economic data boost a country\u2019s currency? <\/th>\n<\/tr>\n<\/thead>\n
Solid economic indicators point to a strong economy. Strong economies have strong currencies because institutions look to invest in countries where growth prospects are high. These institutions require local currency to invest in the country, thus increasing demand and pushing up the money\u2019s worth. So, when a country or region has good economic news, the value of the currency tends to rise. <\/td>\n<\/tr>\n<\/tbody>\n<\/table class=\"table table-bordered\">\n

Following the retail sales surprise, the Bank of England (BoE) policy rate decision was a non-event. The central bank kept rates on hold, as market participants had predicted. The BoE also made reference to the Brexit deal agreed last week, saying that it could reduce the probability of a disorderly Brexit. However, they did not change their interest rate outlook on the back of these thoughts. With no change in interest rate guidance, the pound barely moved.<\/p>\n

With no high impacting UK data today investors could focus on Brexit developments, after UK Prime Minister Theresa May\u2019s trip to Brussels yesterday.<\/p>\n

<\/a>Dollar Buoyed By Strong Retail Sales & Tax Reform News<\/h2>\n

US Retail sales data impressed dollar traders in the previous session. Retail sales for November increased 5.8% year on year. As with the UK, the high figure is in part thanks to strong spending on Black Friday. Strong retail sales figures can point to inflation increasing further down the road, and given the US\u2019s persistently low inflation, this news was well received.<\/p>\n

Also keeping the dollar stable was news that the US tax reform bill was progressing through Congress. The new bill could be ready as soon as today, meaning that it could be voted on next week. The prospect of the bill landing on President Trump\u2019s desk for signing before Christmas, is good news for the economy.<\/p>\n\n\n\n\n\n
How would Trump\u2019s tax reform boost the US dollar? <\/th>\n<\/tr>\n<\/thead>\n
A sizeable corporation tax cut would see a flood of money repatriated to the USA which would then create a high demand for the currency. In turn, this would increase its value versus other currencies. <\/td>\n<\/tr>\n<\/tbody>\n<\/table class=\"table table-bordered\">\n\n\n\n
\n


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This article was initially published on TransferWise.com from the same author. The content at Currency Live is the sole opinion of the authors and in no way reflects the views of TransferWise Inc.<\/em><\/small><\/p>\n","protected":false},"excerpt":{"rendered":"

Retail sales, central bank decisions and tax reform news meant Thursday was a volatile session for the pound US dollar exchange rate. The pound US dollar rate traded an 85-point range hitting a weekly high of US$1.3460 for the pound, before moving lower. What do these figures mean? When measuring the value of a pair […]<\/p>\n","protected":false},"author":163946597,"featured_media":4169,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[1379,1381],"tags":[1394,1398],"class_list":["post-4168","post","type-post","status-publish","format-standard","has-post-thumbnail","category-gbp","category-usd","tag-gbp","tag-usd"],"acf":[],"yoast_head":"\nGBP\/USD: Both US & UK Retail Sales Impress - Currency Live<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/currencylive.com\/news\/100272-gbp-usd-uk-us-retail-sales\/\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Fiona Cincotta\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"4 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\\\/\\\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/100272-gbp-usd-uk-us-retail-sales\\\/#article\",\"isPartOf\":{\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/100272-gbp-usd-uk-us-retail-sales\\\/\"},\"author\":{\"name\":\"Fiona Cincotta\",\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/#\\\/schema\\\/person\\\/8ef0fafb6c93f1204150bb907b42cfec\"},\"headline\":\"GBP\\\/USD: Both US & UK Retail Sales Impress\",\"datePublished\":\"2017-12-15T05:00:00+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/100272-gbp-usd-uk-us-retail-sales\\\/\"},\"wordCount\":758,\"image\":{\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/100272-gbp-usd-uk-us-retail-sales\\\/#primaryimage\"},\"thumbnailUrl\":\"https:\\\/\\\/currencylive.com\\\/news\\\/wp-content\\\/uploads\\\/2019\\\/08\\\/100272-gbp-usd-uk-us-retail-sales.jpg\",\"keywords\":[\"gbp\",\"usd\"],\"articleSection\":[\"GBP\",\"USD\"],\"inLanguage\":\"en-US\",\"copyrightYear\":\"2017\",\"copyrightHolder\":{\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/#organization\"}},{\"@type\":\"WebPage\",\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/100272-gbp-usd-uk-us-retail-sales\\\/\",\"url\":\"https:\\\/\\\/currencylive.com\\\/news\\\/100272-gbp-usd-uk-us-retail-sales\\\/\",\"name\":\"GBP\\\/USD: Both US & UK Retail Sales Impress - 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