The British pound is seen tumbling against the dollar on Friday to around one week low from a two and half month high attained earlier in the week. GBP/USD is quoting at $1.3506, down 0.37% on the day. The pair fell despite positive data from UK showed retail sales climbed 0.5% month-over-month (MoM) in August after advancing 0.5% in July. Core Retail Sales, stripping the auto motor fuel sales, rose 0.8% month on month in August, compared with the previous rise of 0.4% and annual retail sales increased 0.7% in August versus July’s 0.8% revision. The pound is already facing challenges after the Bank of England decided to keep interest rates steady at 4% yesterday. Moreover, firmness in dollar overseas after Fed sounded cautious about further interest rate cuts is weighing on the pair.
Meanwhile, UK government borrowed more than expected last month, official figures show, adding to pressure on the Treasury in the run-up to the autumn budget. Figures from the Office for National Statistics (ONS) showed public sector net borrowing – the difference between public spending and income – rose to £18bn in August, £3.5bn more than in the same month a year earlier. On the NSE, GBP/INR futures plunged by 0.68% and are trading at 119.43.