Sterling got a brief but much needed boost after some positive economic data showing that UK retail sales rose more than expected in September.
The UK Office of National Statistics reported that retail sales volumes jumped 0.6 percent eating expectations for a flat month. August saw a drop of 0.2 percent. On the year sales rose 0.6 percent.
Leading the boost in sales were increase in sales of laptops and video games.
The figure includes fuel prices. Sales numbers excluding fuel though were also up 0.7 percent on the month, also above expectations. On the year, sales were 0.4 percent higher.
The data was good news for British retailers which have been struggling as the UK economic recovery has been sluggish. Most British consumers have been cutting back on spending amid rising prices, muted wage growth and government austerity measures have forced shoppers to rein in purchases not only of non-essential goods but also of groceries, traditionally the most resilient area of spending.
On Wednesday Britain’s top household goods seller, Home Retail, which owns the Argos catalogue stores, reported a 70 percent slump in first-half profit, prompting its chief executive to call on the government to help consumers. Earlier this month supermarket chain Tesco posted one of its biggest-ever quarterly falls in underlying sales.
After the data GBPUSD jumped from 1.5705 to 1.5734 within a minute before settling down.