Here's a brief comment on the UK retail sales data released this morning.
UK retail sales in June bounced back after showing a month on month increase of 0.6%. The prior print of -1.2% was was also revised higher to -1.1% - the 4th consecutive month that the previous reading has seen a favourable adjustment. It is no secret that there has been growing concerns surrounding retailers since the Brexit referendum, a viewpoint that is supported by this morning’s release of annual results from Sports Direct (LON:SPD) which showed a drop of more than half in underlying profits.
However there is a sense that some of the doom and gloom may be a little overdone and going forward the market could well be a little too pessimistic with regard to the future prospects of retailers. In terms of reaction in the pound, sterling has popped higher by around 35 pips in the immediate aftermath of the release after earlier falling to a weekly low underneath the 1.30 handle against the US dollar.