Sterling Falls Against Dollar Following Weak UK Retail Sales Data

Sterling fell against the stronger dollar but was largely flat versus the euro after weaker-than-expected UK retail sales data. Figures from the Office for National Statistics showed retail sales declined 0.1% month-on-month in November, compared to economists' expectations of a 0.3% increase. The office also reported that government borrowing reached ￡11.7 billion in November, down ￡1.9 billion from the same month last year but above the expected ￡10.3 billion. Investors continued to digest the Bank of England's decision on Thursday to cut interest rates by a narrow 5-to-4 vote. Following the data release, the pound dropped 0.1% to $1.3369, from $1.3383 before the release. The euro traded flat against the pound at ￡0.8756, roughly unchanged from pre-release levels.