UK August retail sales beat expectations, rising 1.0% m/m and by 2.8% on the year-on-year comparison. The respective median forecasts had been for much more modest growth rates of 0.2% m/m and 1.3% y/y. July data were also revised higher, to 0.7% m/m, from 0.5%, and to 1.7% y/y, from 1.5% y/y. Good news as the consumer sector is the dominant driver in the UK economy, and with BoE having said that it is keeping a close eye on how households respond to developments related to the process of withdrawing from the EU. Sterling bolted higher, with markets taking the numbers as effectively endorsing the BoE policy statement of last week, which laid the groundwork for gradual policy tightening in the months ahead. The pound is presently showing a average 0.4% gain versus the G3 currencies. Cable logged a high of 1.3607 after rocketing from 1.3510-12 ahead of the data release, though since settling around 1.3550.
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