Pound Slides After Weaker-than-expected Retail Sales

Date : 21/04/2017 @ 15:14
Source : RTTF2
Stock : Euro (B) VS Pound Sterling Spot (Eur/GBP) (EURGBP)
Quote : 0.87385  0.0 (0.00%) @ 10:30
Euro vs UK Sterling share price Chart

Pound Slides After Weaker-than-expected Retail Sales

Euro vs UK Sterling (FX:EURGBP)
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The pound dropped against its major rivals in the early European session on Friday, as data showed that UK retail sales declined more than expected in March.

Figures from the Office for National Statistics revealed that retail sales including automotive fuel decreased 1.8 percent month-on-month in March, reversing a 1.7 percent rise in February. Sales were forecast to fall moderately by 0.5 percent.

Excluding auto fuel, retail sales volume declined 1.5 percent, in contrast to a 1.6 percent rise a month ago and bigger than the expected 0.5 percent drop.

On a yearly basis, growth in retail sales volume eased more-than-expected to 1.7 percent from 3.7 percent. Economists had forecast a 3.3 percent increase.

Excluding auto fuel, retail sales grew 2.6 percent, slower than February's 4.1 percent increase and the expected 3.8 percent.

In other economic news, survey figures from IHS Markit and Knight Frank showed that British households perceived that the value of their homes increased further in April, though the rate of growth eased fractionally.

The Knight Frank/Markit House Price Sentiment Index, or HPSI, dropped to 57.4 in April from 57.5 in March. However, any reading above 50 indicates rise in house prices.

European shares are trading mixed, with investors keeping an eye on developments in France ahead of the start of the French presidential election. It is still unclear which two of the four top candidates will qualify for the final election on May 7, while a Harris Interactive poll signaled a win for centrist Emmanuel Macron in Sunday's first-round presidential election, helping boost market confidence.

The pound held steady against its major rivals in the Asian session.

The pound dropped to 0.8386 against the euro, from a 2-day high of 0.8354 hit at 4:00 am ET. The next possible support for the pound is seen around the 0.85 zone.

Survey results from IHS Markit showed that Eurozone private sector growth hit a fresh six-year high in April.

The flash composite output index rose unexpectedly to 56.7 in April from 56.4 in March. The latest reading was the highest since April 2011. Economists had forecast the score to remain unchanged at 56.4.

The pound, having advanced to 1.2834 against the dollar at 4:00 am ET, reversed direction with the pair trading at 1.2781. Continuation of the pound's downtrend may see it challenging support around the 1.26 region.

Reversing from an early high of 140.15 against the Japanese yen, the pound declined to 139.45. If the pound extends decline, 137.5 is possibly seen as its next support level.

Figures from the Ministry of Economy, Trade and Industry showed that Japan's tertiary activity index increased at a slower-than-expected pace in February, after falling in the previous two months.

The tertiary activity index rose 0.2 percent month-over-month in February, reversing a 0.2 percent drop in January. Economists had expected a 0.3 percent climb for the month.

The pound edged down to 1.2755 against the Swiss franc, following a 2-day advance to 1.2804 at 4:00 am ET. The pound is seen finding support around the 1.26 mark.

Looking ahead, at 7:45 am ET, the Bank of England member Michael Saunders speaks at the Federation of Small businesses in London.

In the New York session, Canada consumer prices for March, Markit's U.S. manufacturing PMI for April and U.S. existing home sales for March are set for release.

At 9:30 am ET, Minneapolis Fed President Neel Kashkari speaks at the Community Economic Development Symposium, in St. Paul.

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