Pound Weakens As U.K. Retail Sales Fall More-than-expected
January 20 2017 - 12:04AM
RTTF2
The pound declined against its major counterparts in the early
European session on Friday, after data showed that U.K. retail
sales declined more than expected in December on non-food store
sales.
Data from the Office for National Statistics showed that retail
sales volume including auto fuel fell 1.9 percent from November
following a marginal 0.1 percent drop in November.
This was bigger than the expected 0.1 percent drop and marked
the second consecutive fall in sales.
Excluding auto fuel, retail sales decreased 2 percent, the first
drop in three months, after rising 0.2 percent in November.
Economists had forecast a 0.4 percent fall for December.
European stocks are trading mixed, with investors adopting a
wait and watch approach ahead of U.S. President-elect Donald
Trump's inauguration speech in Washington.
Trump's inaugural address as the 45th president of the United
States will be closely watched by market participants around the
world for clues about his pro-growth policy proposals.
The pound held steady against its major rivals in the Asian
session, with the exception of the greenback.
The pound declined to 0.8667 against the euro, off its early
high of 0.8628. The next possible support for the pound may be
found around the 0.88 mark.
Data from Destatis showed that Germany's producer prices
increased at the fastest pace in almost four years in December.
Producer prices rose 1 percent year-on-year in December as
expected, the fastest since January 2013, when prices climbed 1.5
percent.
The pound retreated to 141.25 against the yen and 1.2290 against
the greenback, from its previous high of 142.07 and a 2-day high of
1.2372,respectively. On the downside, the pound may target support
around 140.00 versus the yen and 1.21 against the greenback.
Pulling away from an early high of 1.2430 against the Swiss
franc, the pound edged down to 1.2371. If the pound extends slide,
1.22 is possibly seen as its next support level.
Looking ahead, Canada CPI data for December, retail sales data
for November and U.S. Baker Hughes rig count data are set to be
published in the New York session.
At 9:00 am ET, Federal Reserve Bank of Philadelphia President
Patrick Harker is expected to speak about the economic outlook, in
New Jersey.
Later in the day, US President-Elect Donald Trump is expected to
speak at the 58th Presidential Inauguration in Washington DC.
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