Aug 16 Reuters Sterling touched a threeweek high on Friday as retail sales data added to signs of positive momentum in the UK economy, with gains underpinned by a broad recovery in risk appetite.

Data showed British retail sales edged up 0.5 in July, boosted in part by extra spending due to the men39;s Euros soccer championship, following a 0.9 drop in June when an unusually cool and wet weather had kept shoppers away.

That follows data showing UK gross domestic product grew 0.6 in the second quarter of 2024, inline with economists39; expectations.

The pound climbed 0.4 against the dollar to 1.2904 on Friday its strongest level since July 25. The currency was last up 1.2 on the week, on track for its biggest weekly rise in more than a month.

The Bank of England cut interest rates from a 16year high this month and Britain39;s longestrunning consumer confidence measure rose to its highest in nearly three years as shoppers became more willing to make big purchases.

Signs of resilience in the economy and tame inflation readings have prompted traders to price in fewer interest rate cuts from the Bank of England than are expected from the Federal Reserve, supporting the currency.

Traders see 43 basis points of rate cuts from the BoE this year and are pricing in a 37 chance of a 25bps cut at the central bank39;s September meeting. They see nearly 62 bps of rate cuts from the Fed by the end of 2024.

From a monetary policy point of view this week39;s data has not altered…