- GBP/USD struggled to capitalize on its intraday positive move amid COVID-19 jitters.
- A subdued USD price action extended some support and helped limit the downside.
- Rallying US bond yields, upbeat US Retail Sales data failed to impress the USD bulls.
The GBP/USD pair held steady near the 1.3815-20 region and had a rather muted reaction to upbeat US monthly Retail Sales figures.
Having shown some resilience below the 1.3800 mark, the GBP/USD pair gained some positive traction during the first half of the European session, albeit struggled to capitalize on the move. The worsening COVID-19 situation in the UK acted as a headwind for the British pound and capped gains for the major.
The uptick ran out of steam rather quickly and met with some fresh supply near the 1.3860 region. That said, a subdued US dollar price action extended some support to the GBP/USD pair. The USD bulls shrugged off a strong pickup in the US Treasury bond yields and also seemed unimpressed by stronger US macro data.
The US Census Bureau reported that the total value of sales at the retail level increased by 0.6% in June, surpassing consensus estimates pointing to a 0.4% decline. Excluding autos, core retail sales also smashed expectations and jumped 1.3% MoM during the reported month, though did little to boost the greenback.
A downward revision of the previous month’s already weaker readings seemed to be the only factor that held the USD bulls from placing any bets. nevertheless, the data should reinforce market expectations that the Fed will tighten its policy sooner. This might help the USD to attract some buying and exert pressure on the GBP/USD pair.
