Retail Sales boosts the Pound

  • EUR French flash manufacturing PMI
  • EUR German flash manufacturing PMI
  • EUR Flash manufacturing PMI
  • EUR Flash services PMI
  • GBP Retails sales
  • EUR Monetary policy accounts
  • USD Unemployment claims
  • USD Existing home sales
  • USD Philly Fed manufacturing index

Yesterday’s economic docket was jam packed, with UK retail sales dominating the schedule. Last month’s retail sales figure dropped into negative territory after a decline in petrol sales; however yesterday’s reading exceeded market consensus by more than double, posting a reading of 1.2% against the forecasted 0.4%. Its best reading this year. The rise in sales can be contributed to the recent warm weather which has helped to boost clothing demand to its highest level in four years. Sterling strength occurred after this release as consumer spending is one of the main drivers of Britain’s economy.

Also released yesterday morning was a raft of Eurozone services and manufacturing PMI data. Across the board it was disappointing with services PMI in Germany, France and the Eurozone all missing expectations. However, it wasn’t all bad news for the Euro as manufacturing PMI exceeded expectations in the Eurozone. Shortly after, the US released two pieces of positive high tier data. The Philly Fed and existing home sales figures both fell short of economists’ consensus, adding to continued evidence that a June rate hike could still be out of the picture.

  • EUR German final GDP
  • EUR ECB President Draghi
  • EUR German Ifo Business Climate
  • GBP Public sector borrowing
  • GBP BoE Carney speaks
  • USD Core CPI

Both BoE Gov. Carney and ECB President Draghi are due to speak later on in the day at the ECB Forum on Central Banking. As always, the market will keep an eagle eye on the language they use for clues on future policy. Meanwhile, the German IFO sentiment reading along with key US inflation data should keep the market busy.