Poor performance from UK Retail Sales GBP Sterling has been vulnerable against most major currencies over the last few days as the Russia-Ukraine war raised the potentiality of a recession in Europe. GBP/USD hit a fifty-two week low as markets are dumping the European domain currencies on the expectation of a stagflation situation going forward. Poor performance from the Retail Sales by the British Retail Consortium (BRC) has added further fuel to the fire. The figure came in at 2.7%, much lower than the market consensus and prior readings of 15.2% and 8.1%. USD The likelihood of stagflation happening has increased since the US government confirmed the ban on Russian oil imports in the US. The US is able to sustain such a ban as oil imports from Russia only count for a small amount. Europe, on the other hand, are more reliant on Russia’s crude oil and gas. EUR The euro has found some support ahead of the EU’s emergency summit and the upcoming European Central Bank (ECB) policy meeting. Despite this, with the probability that soaring commodity prices will halt growth in Europe, currency markets are still betting on the ECB delaying rate hikes until late 2022 at the earliest. The opposite can be said for the US and the Federal Reserve (Fed). Fed Chair Jerome Powell has seemingly backed a 25 basis points rise next week, while also stating the Fed will move more aggressively if inflation doesn’t begin to decrease.