GBP Rises vs. USD, Fails vs. EUR & JPY

Positive economic reports continued to drive the Great Britain pound higher against the US dollar, but did not help the currency versus the euro and the Japanese yen.

UK retail sales grew 0.6 percent in November, according to British Retail Consortium. The Markit/CIPS UK Construction Purchasing Managers’ Index rose sharply from 59.4 in October to 62.6 in November, exceeding expectations by a wide margin.

For some time traders were worried that the sterling’s rally would lose steam as the market gets used to continuous stream of good news. For now, such worries did not come true. Still, there is a danger that the strong rally may be followed by a big correction.

GBP/USD traded at 1.6388 as of 23:28 GMT today after rallying from 1.6354 to 1.6435. GBP/JPY went down from 168.34 to 167.76 and EUR/GBP rose from 0.8278 to 0.8291.

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