The British pound was little changed at $1.337 on Friday, hovering near its weakest level since late July, as investors digested stronger-than-expected retail sales data alongside this week’s central bank decisions. UK retail sales rose 0.5% in August, beating forecasts of a 0.2% decline and rebounding from July’s drop. Department stores drove much of the recovery as retailers resolved earlier stock availability problems, underscoring the resilience of consumer spending despite high energy costs and the outlook for tighter monetary policy.
The Bank of England left interest rates unchanged on Thursday and announced it would halt sales of very long-dated gilts under its quantitative tightening programme, while cautioning that a protracted conflict in the Middle East could necessitate tighter policy. Meanwhile, the Federal Reserve and the Bank of Japan also raised interest rates this week and signaled room for additional tightening later this year.
