Sterling Falls as U.K. Retail Sales Slump in December

The pound was lower on Friday as the uncertainty over Brexit continued to put pressure on the economy.

U.K. retail sales fell for the first time since March, suggesting that consumers are becoming more cautious as Brexit nears.

GBP/USD decreased 0.34% to 1.2938 as of 4:48 AM ET (9:48 GMT) while EUR/GBProse 0.40% to 0.8805.

Prime Minister Theresa May‘s Brexit deal was defeated in parliament on Tuesday but she won a subsequent vote of confidence, which has removed some political uncertainty. Analysts have interpreted this week’s events as reducing the risk that the country will fail to strike a deal with European Union before it leaves the bloc on March 29. That has pushed the pound up over 2.6% against the dollar since Jan. 2.

The U.S. dollar was little changed as investors wait for more progress on U.S.-China trade talks.

A Wall Street Journal report that U.S. Treasury Secretary Steven Mnuchin is in favor of easing tariffs on Chinese imports sent U.S. stocks and the dollar higher, despite the Treasury Department denying the news.

The U.S. dollar index, which measures the greenback’s strength against a basket of six major currencies, rose 0.07% to 95.782.

The yen, typically sought by investors as a safe haven during times of economic or market stress, was lower against the dollar, with USD/JPY rising 0.32% to 109.56.

Elsewhere, the euro was flat at 1.1392.

The risk-sensitive Australian and New Zealand dollars were lower, with AUD/USD falling 0.13% to 0.7179 and NZD/USD slipping 0.16% to 0.6750./investing.com

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