The British Pound was immediately attacked by sellers on Thursday morning after retail sales tumbled -0.5% in June, well below the 0.2% market expectation.

With wage growth disappointing and inflation cooling as well, is this really the right environment to raise interest rates? Market expectations over the Bank of England raising interest rates next month are now likely to be heavily diminished and this can already be reflected in the Pound’s bearish price action. With the Sterling highly sensitive to monetary policy speculation, further losses may be witnessed as investors scale back bets of a rate hike this quarter.

The GBPUSD has plunged to a 10-month low below 1.2990 this morning and has scope to extend losses as long as bears can maintain control below 1.3000. If the Dollar continues to appreciate, the next key level of interest can be found around 1.2950.