Pound Falls On Weak U.K. Retail Sales Data
October 20 2016 - 1:29AM
RTTF2
The British pound weakened against the other major currencies in
the European session on Thursday, after data showed that the U.K.
retail sales rose less-than-expected in September.
Data from the Office for National Statistics showed that the
retail sales, excluding auto fuel, advanced 4 percent, but slower
than the expected growth of 4.4 percent and August's 6.2 percent
expansion.
Meanwhile, sales excluding auto fuel also remained flat in
September. Economists had forecast a 0.2 percent rise.
Retail sales volume increased 4.1 percent year-on-year in
September. Nonetheless, the pace of growth eased from 6.6 percent
in August. Economists had forecast a 4.7 percent annual increase.
Also, the 4.1 percent growth was the weakest since June.
In the Asian trading today, the pound held steady against its
major rivals.
In the European trading, the pound fell to a 2-day low of 1.2119
against the Swiss franc, from an early high of 1.2168. The pound
may test support near the 1.18 region.
Against the euro, the U.S. dollar and the yen, the pound dropped
to 0.8949, 1.2263 and 127.12 from early highs of 0.8922, 1.2298 and
127.49, respectively. If the pound extends its downtrend, it is
likely to find support around 0.91 against the euro, 1.19 against
the greenback and 124.00 against the yen.
Looking ahead, the European Central bank will announce its
interest rate decision at 7:45 am ET. The bank is forecast to keep
its refi rate at zero percent and the deposit rate at -0.4
percent.
Following the announcement, European Central Bank President
Mario Draghi will hold the customary post-meeting press
conference.
In the New York session, U.S. weekly jobless claims for the week
ended October 15, U.S. existing home sales data, leading
indicators, for September, and U.S. Philly Fed manufacturing index
for October are set to be published.
At 8:00 am ET, Bank of England Deputy Governor Nemat Shafik is
expected to participate in a panel discussion about reform in the
financial services industry at the Federal Bank of New York's
conference.
At 8:30 am ET, Federal Reserve Bank of New York President
William Dudley is scheduled to give welcome remarks at a conference
entitled "Reforming Culture and Behavior in the Financial Services
Industry: Expanding the Dialogue", in New York.
European Union leaders summit is due to be held in Brussels,
later in the day.
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