Retail Sales Further Dent Sterling

20 October, 2017

Paul Newfield

Yesterday morning saw UK retail sales further dent sterling, sending the pound down against the Euro by over a third of a cent. The month on month and year on year figures coming in significantly below the previous numbers and more importantly, the expected. Over the course of the day, we saw the rate continue to fall another 30 pips. Despite the positive outcome of the US data, including employment data and manufacturing, which saw minor improvements. The pound’s weakness has come to the fore once again and the possibility of further decreases in value remains a likely outcome.


Elsewhere, down under, the Aussie’s were celebrating impressive employment figures. Unemployment change and the unemployment rate coming in positively. Despite the good numbers, GBP-AUD dropped by only a half-cent when, realistically due to the very nature of the pound at the moment, it could well have been more.


Today sees very little in the way of UK data and with that little opportunity for the pound to correct itself back up before the weekend. The only significant publication is the Public Sector Net Borrowing, which provides details on the amount of new debt held by the UK government. A low or negative figure is what is hoped for to give the pound any hope of clawing back the weeks’ losses.

For those of you closely following the Canadian situation, they are expecting figures to be released concerning retail sales and CPI inflation. These details are out at 13:30. Over the border in the US, there are a couple of key releases but these won’t be made available until after trading in the UK has come to an end. The key articles to look out for are the Baker Hughes Oil Rig Count at 18:00 and the FOMC Mester speech at 19:00 along with the monthly budget statement. Janet Yellen is also due to speak at 19:30 US time. The Pound is faring better against the USD than the Euro, and is over 10 cents higher than the low-point back in January, but has been dropping for the past month.

With very little to go on today, data-wise, investor sentiment could rule the day. Bear in mind most see the pound in a perilous situation so it may be prudent to secure your currency sooner rather than later.

Retail Sales