Retail sales give Pound a boost

This morning’s UK retail sales figures showed a surprise 0.4% increase in June, at the same time as Germany and France agreed to allow Greece to slip into temporary default if necessary.

The Franco-German deal has given us some Euro weakness, improving exchange rates for those of you sending payments to the Eurozone. Across the board, sterling has also taken some strength from the retail sales figures, which were expected to show a small decrease in June.

Before we get carried away however, there is still a risk that Q2 GDP may show a negative reading, sparking fears of a ‘double dip’ recession. Public borrowing figures, also out this morning, showed that the public deficit indicates more fundamental problems in the British economy.

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