UK Retail Sales missed their mark printing at 0.1% versus 0.6% eyed as weather related factors depressed demand in the month of June. Retail sales ex auto fuel retail sales were up 0.3% on the month and by 2.2% on the year.

Food Sales in particular were hit the hardest with decline of 0.7% as the wettest June since 1910 kept many shoppers away from the stores. Without a fall in food sales the overall sales number would have risen significantly as non-food sales rose 1.2% on the month, with all categories posting increases on the month.

The news suggests that consumer demand in UK may be stabilizing but the weaker overall number will nevertheless weigh on Q2 GDP figures and will keep BoE in a dovish posture for the foreseeable future. Cable sold off on the news dropping by about 30 points in the aftermath of the release but remains relatively firm in light of supportive price action from equities. If risk appetite continues in the US session the pair could make another run at the 1.5700 barrier as the day proceeds.

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