Sterling tilted higher in American trade to the best since December 8 versus the greenback, after the policy decisions of the Bank of England and a spate of data from Britain and the US.
As of 05:50 GMT, GBP/USD rose 0.09% to 1.3429 from the opening of 1.3420, with a one-week high at 1.3466, and a session-low at 1.3385.
Earlier UK data showed retail sales accelerated to 1.0% from 0.5% in October, beating expectations of 0.4%, while accelerating to 1.6% y/y, beating forecasts of 0.3%.
Core sales grew 1.2%, beating forecasts of 0.4%, while yearly core sales rose 1.5%, passing expectations of 0.2%.
The Bank of England voted to hold interest rates unchanged at 0.50% and the assets purchase program at 435 billion pounds, with all members voting unanimously for the decision.
Otherwise, earlier US data showed unemployment claims fell to 225 thousand in the week ending December 9, the fourth weekly decline in a row, from 236 thousand in the previous reading, while analysts expected 237K.
US retail sales rose 0.8% in November past expectations of a 0.3% rise, and better than October's 0.5% increase, revised higher from 0.2%.
Core retail sales, excluding transportation, rose 1% last month, beating expectations of a 0.6% rise, and compared to October's 0.4% rise, revised upwards from 0.1%.
The US manufacturing PMI rose past expectations to 55.0 while the services PMI slowed down to 52.4, as business inventories fell 0.1% in line with expectations in October.
Earlier this week, the Federal Reserve voted to increase interest rates by 25 basis points for the third time this year, while updating their three-year forecasts for growth, inflation, unemployment, and interest rates.