U.K. Pound Tumbles in Currency Trading

The U.K. pound has tumbled in currency trading against the U.S. dollar, thanks to the latest retail sales out of Britain. Indeed, the latest news shows that consumers are not ready to make discretionary spending moves right now.

GFT's Boris Schlossberg explains, in FX360, what the latest retail sales data means for the sterling forex trading forecast:

Today’s data suggests that the UK consumer remains cautious and unwilling to make large discretionary purchases  for the household. The news also dovetails with today's poor RICS house price balance data which came in at -8% versus 5% expected. As demand for UK housing begins to decline again the drop off in durable goods purchases is likely to continue for the rest of the year depressing retail sales and GDP growth. 

The news is putting a damper on hopes for economic recovery. The same sort of thing is happening in the U.S., but the U.S. dollar is gaining from it. With uncertainty about what will happen next, investors are turning to the safe haven of the dollar.