Pound dips lower after softer UK retail sales once more

<p>It is another month of disappointment for UK retail sales activity, with the data <a href="https://www.forexlive.com/news/uk-october-retail-sales-03-vs-03-mm-expected-20231117/" target="_blank" rel="follow">here</a> missing on estimates significantly once again. ONS cites retailers as saying that cost of living pressures, reduced footfall, and wet weather in the second-half of October to have contributed to the monthly decline. But it seems to be the case almost every other month now in the UK, innit?</p><p>As high inflation continues to grip the economy, households are tightening the purse strings and it is showing up quite markedly in the retail sales data. The pound has taken a dip from around 1.2412 earlier to 1.2380 currently and is closing in on the 100-hour moving average (red line) at 1.2379:</p><p>Keep above and buyers will still hold the near-term bias but break below and that will shift to being more neutral again.</p><p>As much as the dollar has been in a softer spot this week, UK data hasn't really helped the pound to capitalise on that as seen today with retail sales and the inflation report yesterday.</p><p>Elsewhere, EUR/GBP is also starting to make a move as the pair nudges to contest resistance around 0.8750-55 at the moment. Keep in mind that there are also <a href="https://www.forexlive.com/Orders/fx-option-expiries-for-17-november-10am-new-york-cut-20231117/" target="_blank" rel="follow">large option expiries</a> at the level that could help to keep the pound from falling much further, at least for now.</p>

This article was written by Justin Low at www.forexlive.com.