Sterling Surges Past 1.35 Against Dollar Amid Weaker US Data

The Pound Sterling ended the week on a stronger footing after UK GDP data showed the economy expanding by 0.4% in the second quarter and 0.3% in June, easing fears of a sharper slowdown.

This came as US retail sales unexpectedly fell in July, while consumer sentiment weakened again, reducing pressure on the Federal Reserve to push ahead with another near-term rate increase.

The Pound to Dollar exchange rate finished the week firmly above 1.35, but positioning is now more stretched after the pair moved close to its 30-day high.

The UK inflation and labour-market releases next week will decide whether Sterling can hold the 1.35 area on its own merits, rather than simply benefiting from Dollar selling.