Can The Pound Soar Higher After This Data?

<p>&nbsp;UK retail sales rose more than expected in June driven by warm weather which prompted consumers to increase their spending.</p><p><br /></p><p>Most recently, the Office for National Statistics (ONS) reported total retail sales rose 0.7% in June from a revised 0.1% in May, and missed expectations for a 0.2% rise.</p><p><br /></p><p>Meanwhile, on an annual basis, retail sales contracted by 1.0% compared to expectations for a 1.5% drop.</p><p><br /></p><p>As a result, it can be seen that UK consumer spending remained resilient in June despite being weighed down by inflation and higher interest rates by the Bank of England (BOE).</p><p><br /></p><p><br /></p><p>A pick-up in retail demand has offset optimism about lower inflation in June as higher consumer spending could prompt firms to raise prices of goods and services again.</p><p><br /></p><p>Following that, investors restored expectations for the BOE to implement a 50 basis point hike at the policy meeting on August 3.</p><p><br /></p><p>However, the easing inflation data caused investors to remain divided on whether the central bank will raise rates by 25 basis points or 50 basis points.</p><p><br /></p><p>The pound currency jumped momentarily at 1.2900 against the US dollar as an initial reaction to the release of the data.</p>