Sterling rises after UK retail sales beat forecasts.

Retail sales jump, Pound rises.

The Pound bounced this morning after data showed UK consumer spending was stronger than expected in June, in spite of high inflation, as wage growth picked up, supporting the case for more rate rises from the Bank of England this year.?Retail sales rose by 0.7% in June from May, topping forecasts for an increase of 0.2%, while year-on-year, they fell 1.0%, compared with expectations for a decline of 1.5%, according to official data.?Sterling rose by as much as 0.28% to a session high of $1.2904 after the figures. The Pound is still heading for its largest weekly loss against the Dollar since January, after separate data earlier this week showed British inflation cooled far quicker than forecast last month. That data had prompted traders to pare back their expectations for UK rates to rise to as much as 6%.

Euro-Area consumer confidence improves more than expected.

Euro-area consumer confidence increased more than expected in July, an encouraging sign for the 20-nation currency bloc. The reading of -15.1 — after -16.1 in June — compares with an economist estimate of just -15.8. The European Commission said improvement shows that the gauge “is slowly but steadily recovering toward its long-term average.” The data come hours after revised Eurostat numbers revealed that the region avoided a winter recession after all.

Dollar firms, yen wobbles as Japan inflation holds above BOJ target.

The Dollar was steady overnight?as data pointed to U.S. labour market resilience that could lead the Federal Reserve to keep interest rates higher for longer, while the yen wobbled after Japan's core consumer inflation re-accelerated in June.?Central bank meetings from Europe, Japan and the United States are due next week, with investors parsing through data to better gauge monetary policy paths they will likely chart.?Meanwhile, data overnight showed the number of Americans filing new claims for unemployment benefits unexpectedly fell last week, touching the lowest level in two months amid ongoing labour market tightness.?Markets expect a 25 basis point hike from the Fed next week and the odds of the U.S. central bank to continue raising rates nudged up after the data.