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Pound slides to 18-month dollar low on weak UK data

The pound slumped more than one percent against the dollar Friday after official data showed tumbling retail sales as Britons grapple with a cost-of-living crisis.

FILE PHOTO: Wads of British Pound Sterling banknotes are stacked in piles at the Money Service Austria company’s headquarters in Vienna, Austria, November 16, 2017. REUTERS/Leonhard Foeger

The pound slumped more than one percent against the dollar Friday after official data showed tumbling retail sales as Britons grapple with a cost-of-living crisis.

In London morning deals, sterling sank to $1.2887 — its lowest level since October 2020, also as Prime Minister Boris Johnson comes under renewed political pressure.

London’s benchmark FTSE 100 index was down 0.5 percent, as shares in retailers fell sharply on the data.

News that UK retail sales had plunged by 1.4 percent in March could put the brakes on the Bank of England’s policy of hiking interest rates to curb soaring inflation.

Britain’s currency has strengthened recently after the BoE hiked interest rates three times in a row.

“Until we get some further clarity on what the Bank of England might do next month … the pound could well remain under pressure,” said CMC Markets analyst Michael Hewson.

On the political front, British MPs on Thursday backed an investigation into whether Johnson lied to parliament over lockdown-breaking parties at his Downing Street office.

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