UK retail sales dominated yesterday’s price action. The weaker Pound, decent weather and the end of the Euro 2016 championships all helped to boost consumer spending in July. Retail sales posted a much better than expected 1.4% against forecasts of 0.1%, boosting the year-on-year to 5.9%. Sterling climbed about half a cent to a two-week high against the Greenback after the release of these figures. This was another post-Brexit figure released this week that suggests the UK economy remains resilient after the shock leave victory of June.
Across the pond, the US released two pieces of high tier data. Firstly, unemployment claims exceeded economists’’ consensus of 262k. The number of Americans filing for unemployment benefits is falling, reinforcing views of labour market strength that could encourage the Federal Reserve to raise interest rates sooner than expected. Simultaneously, the US posted the Philly Fed Manufacturing Index which also registered a higher than expected reading. The Philly Fed posted 2.0 bouncing back from last month’s negative figure.
The week finishes with very little high tier data being released. Public sector net borrowing is the only figure out from the UK with a surplus figure of 2.3bn due to be posted. We also have German PPI and Canadian retail sales released today as well.