Pound Sterling Slips after ONS Confirms First-quarter Slowdown but Economists say UK Poised for Q2 Rebound

U.K. retail sales crushed expectations on Thursday, May 24 and Pound Sterling has responded by going higher.

We are hearing from a number of foreign exchange strategists that there is a good risk-reward ratio in buying the Pound at current levels amidst expectations for a rebound in the currency following a poor run against a host of competitors.

Inflation data for March has come out softer than markets had expected and the British Pound has promptly fallen back.

The British Pound might have fallen over recent days on the back of doubts of Theresa May's grip of the helm of the Tory party, but any weakness stemming from this story will be short-lived says one analyst.

Those watching the British Pound today should be aware that the Governor of the Bank of England Mark Carney will be testifying before Parliament's Treasury Select Committee.

"This extremely negative sentiment towards the Pound makes us wonder whether the currency will stage a surprise reversal." - Forex.com.

Sterling entered the new week on the back foot Monday, falling below a key technical level against the US Dollar as the greenback advanced and markets shunned the British currency in the wake of the latest developments in UK politics. 

Two interest rate rises in 2018, followed by a further two interest rate rises in 2019 at the Bank of England are forecast to propel the British Pound higher against both the Euro and US Dollar say economists at independent advisory Capital Economics.