When is UK retail sales and how could affect GBP/USD?

UK retail sales Overview

The retail sales data is expected to drop sharply to -0.8% m/m in May, while on annualized basis, retail sales are expected to drop to 1.7%. In April, retail sales were seen at 2.3% over the month. The report will be published later this session at 0830GMT.

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, a deviation can fuel movements of upto 100 pips.

How could affect GBP/USD?

A positive surprise in the retail sales report could rescue the GBP bulls, helping the rate to regain 1.2765-70 levels. While a worse-than expected print would knock-off the pair back towards multi-month lows of 1.2620. However, the bigger risk event for the pound remains the BOE monetary policy decision.

In terms of technicals, “(GBP/USD) Currently hovering around mid-1.2700s, bears would be eyeing for a break through the 1.2700 handle, below which a fresh wave of selling pressure is likely to drag the pair back towards an important confluence support near 1.2630-25 region. Alternatively, sustained move back above 1.2780-85 region, coinciding with 38.2% Fibonacci retracement level, might continue to confront some fresh supply near 1.2815-20 region,” Haresh Menghani, Analyst at FXStreet notes.

Key notes

UK: Expect a 1% fall in sales volumes in May - Nomura

UK: Markets looking for a -0.8% reading in May for retail sales - TDS

About UK retail sales

The retail Sales released by the National Statistics measures the total receipts of retail stores. Monthly percent changes reflect the rate of changes of 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.