Fed Raise Rates, Sterling Lower

Sterling dipped around 0.2 percent against the dollar in morning trade in London this morning, suffering along with other major currencies from a boost to the greenback from Wednesday’s U.S. Federal Reserve policy decision and commentary.

The pound was barely higher against the euro, however, and dealers said the currency was still subject to nerves around Prime Minister Theresa May’s efforts to gain the backing she needs for a new minority government.

An evening speech by Chancellor Philip Hammond is expected to lay out his vision of a business-friendly Brexit and will be eyed for signs of a softening of budget cuts after May’s Conservatives lost their majority in an election a week ago.

Retail sales figures due released at 0930 GMT came in much lower than expectations matching recent signals that consumer spending is flagging, year on year came in at 0.6% which is way off the expected 1.9%.

The Bank of England is expected to make no changes to policy after its regular meeting (1200 GMT).

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