Sterling Drops On Retail Figures
22 March, 2012
Pound to euro exchange rates were comfortably above the 1.2 mark this morning having jumped from start of European trade as weaker German services and manufacturing PMI sent the Euro lower against sterling and the dollar.
Manufacturing PMI in the EMU also dropped from 49.0 to 47.7 in March, despite a rising consensus of 49.5. Services data dropped by 0.1 from 48.8 to 48.7, against 49.2 expectations. Anything below 50 is seen as contraction in the sector and therefore negative. A drop into further contraction obviously doesn’t bode well, hence the Euro sell off first thing today.
Unfortunately the 1.2 trading level was short lived as retail sales in the UK came in lower than forecast. For the month sales came in at -0.8% compared to expected -0.4% and 1% for the year rather than 2.5% expected. This is a significant difference which weighed heavily on sterling across the board. Against the Euro we lost half a cent and a whole cent against the US dollar.
Sending Sterling To The Southern Hemisphere?
Overnight sterling gained 2 cents against the New Zealand dollar as their GDP came in well below forecast giving best New Zealand Dollar exchange rates from the pound since the start of the year. Further concerns over an economic slowdown in China are also weighing negatively on the Australian dollar (as well as the Kiwi) so for those looking to buy either currency there are some good opportunities to secure now.
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