020 7898 0500UK retail sales were far stronger than expected in the month of August. According to a report by the Office for National Statistics, retail sales increased by 1.0% last month – the third consecutive month they have risen.
Sterling strengthened significantly against the US dollar as a result, as the markets prepared for yet another rally by the pound. The increase in retail sales is particularly surprising given that household incomes are being squeezed by inflation, and there was speculation that it could be as a result of increased borrowing.
It’s a fairly quiet day today, although we will see the release of UK mortgage approvals data. However, it is clear that the main attention will now be on UK Prime Minister Theresa May’s key speech in Florence tomorrow. The question is whether she will adopt a hardline Brexit stance, or opt for a Swiss-style arrangement with the European Union.
