GBP/USD renews intraday low near 1.1950 despite mixed UK Retail Sales, PMIs in focus

• GBP/USD takes offers to refresh intraday low on mixed UK Retail Sales data.
• UK Retail Sales for June improved on MoM but dropped on YoY for June.
• Risk-off mood, pre-Fed positioning helps US dollar to consolidate the first weekly loss in four.
• UK/US PMIs, UK politics will be important for fresh catalysts.

GBP/USD pays little heed to the UK’s Retail Sales figures for June as it holds lower ground near the intraday low following the data release. That said, the Cable pair refreshes daily lows around 1.1960 heading into Friday’s London open.

UK Retail Sales for June improved more than -0.3% expected and -0.8% prior to -0.1% MoM. That said, a core version of the key British data, i.e. Retail Sales ex-Fuel, reverses the -0.4% market consensus and -0.1% previous readings to 0.4% positive figures.

Also read: UK Retail Sales fall 0.1% MoM in June vs. -0.3% expected

The cable pair’s inaction despite mostly firmer UK data could be linked to the market’s cautious mood ahead of the preliminary US S&P Global PMIs for July, as well as the next week’s Federal Open Market Committee (FOMC). Furthermore, Hong Kong’s market intervention and fears of economic slowdown in China’s 2022 GDP growth, as signaled by the Asian Development Bank (ADB), also exert downside pressure on the GBP/USD prices, due to its trade links with Beijing.

It’s worth mentioning that political deadlock in the UK, due to the impending final announcement of the Tory leader, scheduled for September, also exerts downside pressure on the GBP/USD prices. Furthermore, the European Union’s (EU) dislike for Foreign Minister Liz Truss, due to her Brexit role, also raises challenges for the pair traders as ex-Chancellor Rishi Sunak has little support due to his resistance to tax cuts.

Moving on, GBP/USD traders should pay attention to the S&P Global PMIs for the UK for July. If the UK activity data came in softer, the pair may extend its latest weekly rebound. However, odds are high in favor of the hawkish Fed and the Cable pair’s a further weakness due to the US dollar’s safe-haven status.

Technical analysis

Unless crossing the 21-DMA hurdle surrounding 1.2020, GBP/USD remains vulnerable to testing the short-term horizontal support near 1.1930 before directing the bears towards the yearly low of 1.1760.