Pound Advances After Strong U.K. Retail Sales

Pound Advances After Strong U.K. Retail Sales




The pound climbed against its major counterparts in early European trading on Friday after the release of the country's upbeat retail sales data for March.
Data from the Office for National Statistics showed that retail sales volume including automotive fuel grew 1.8 percent from a month ago. That was much larger than the 0.5 percent rise forecast by economists. Annually, it was up 3.3 percent, compared to the consensus forecast of 1.5 percent.
Retail sales, excluding automotive fuel rose 1.5 percent month-on-month and advanced 2.8 percent from the previous year. Economists were looking for a 0.4 percent monthly growth and 1.3 percent annual expansion.
The U.K. currency hit a new 5-1/2-month high of 1.6120 against the dollar and more than a 2-week high of 131.71 against the yen, compared to yesterday's close of 1.6055 and 131.02, respectively. The next upside target level for the pound is seen at 1.62 against the greenback and 132.5 against the yen.
After hitting a 2-day low of 1.4661 against the franc, the pound rebounded at 4:30 am ET. The pair is now trading at 1.4708, compared to Thursday's close of 1.4694.
Against the euro, the pound is now trading at 0.8178, compared to a 2-day low of 0.8203 hit at 4:00 am ET.
In economic news from Europe, Germany's producer price inflation accelerated unexpectedly in March on higher energy prices.
Producer price inflation rose to 3.3 percent on a yearly basis in March from 3.2 percent in February. Economists were forecasting the rate to slow to 3.1 percent.
Meanwhile, the Munich-based Ifo institute reportedly said that German business sentiment improved unexpectedly in April. The business climate index rose to 109.9 in April from 109.8 in March. Economists were forecasting the reading to drop to 109.5.
Looking ahead, Canada's CPI for March is due at 8:30 am ET.
Investors also shift their focus to the G-20 finance ministers meeting that started in Mexico and the semiannual meetings of the International Monetary Fund and World Bank from Thursday through Sunday in Washington.
IMF chief Christine Lagarde said Thursday that she had commitments from several countries to significantly bolster crisis-fighting resources.


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