While the Pound began the local session clinging to yesterday’s gains against the Euro, the British currency extended losses against the US Dollar as UK retail sales faltered in October.
The Pound Sterling to US Dollar Exchange Rate was in the region of 1.6002 as of 10:35 GMT
After advancing on the Euro yesterday as a result of surprisingly upbeat UK employment data and a hawkish inflation report from the Bank of England, the Pound was little changed against the common currency as sales slumped by 0.7 per cent, month-on-month, rather than stagnating as expected. A MoM fall of 2.8 per cent in clothing sales was largely responsible for the decline and the drop wiped out Septembers MoM gain of 0.6 per cent.
Sales were up 1.8 per cent on the year, considerably less than the 3.1 per cent advance forecast by economists.
According to Kate Davies from the Office for National Statistics; ‘Clothing sales have been dampened by a milder October then we’ve seen in previous years. There have also been falls in food and petrol. But the wider economic growth picture is much more positive – this follows eight or nine months of growth in the retail sector. In the summer, sales were very much boosted by warm weather – particularly in July and August.’
While UK data has largely been surprising to the upside in recent weeks, this result reaffirms that there are still economic challenges ahead.
1 US Dollar is currently worth 0. 6250 pence
Although the Pound stumbled against the US Dollar in the aftermath of the report’s publication, losses against the Euro were limited as the common currency came under domestic pressure of its own.
With economic growth in France and Germany slowing in the third quarter and the Eurozone’s economy contracting by more-than-expected year-on-year the Euro became trapped in a bearish relationship with the majority of its most traded rivals.
If today’s US initial jobless claims data and trade balance figures bolster the ‘Greenback’ the GBP/USD pairing may edge lower before the close of the European session.
Tomorrow’s inflation data for the Eurozone could also lead to further GBP/EUR movement before the weekend.
Current Pound Sterling (GBP) Exchange Rates:
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The Pound Sterling/US Dollar Exchange Rate is currently in the region of: 1.6002 <
The Pound Sterling/Euro Exchange Rate is currently in the region of: 1.1909 >
The Pound Sterling/Australian Dollar Exchange Rate is currently in the region of: 1.7206 >
The Pound Sterling/New Zealand Dollar Exchange Rate is currently in the region of: 1.9391 >
The US Dollar/Pound Sterling Exchange Rate is currently in the region of: 0.6250 >
The Euro/Pound Sterling Exchange Rate is currently in the region of: 0.8402 >
The Australian Dollar/Pound Sterling Exchange Rate is currently in the region of: 0.5810 <
The New Zealand Dollar/Pound Sterling Exchange Rate is currently in the region of: 0.5152 <
(As of 10:35 GMT)
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