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Forex - GBP/USD almost unchanged after upbeat U.K. data

Published 11/20/2014, 04:40 AM
Updated 11/20/2014, 04:40 AM
Pound holds steady vs. dollar despite strong U.K. retail sales

Pound holds steady vs. dollar despite strong U.K. retail sales

Investing.com - The pound was almost unchanged against the U.S. dollar on Thursday, after the release of upbeat U.K. retail sales data, as the Federal Reserve's latest policy meeting minutes continued to lend broad support to the greenback.

GBP/USD hit 1.5632 during European morning trade, the session low; the pair subsequently consolidated at 1.5674, down just 0.04%.

Cable was likely to find support at 1.5588, Wednesday's low and a 14-month low and resistance at 1.5782, the high of November 13.

The U.K. Office for National Statistics said retail sales increased 0.8% last month, above forecasts for a gain of 0.4%. September retail sales fell by 0.4%.

Year-on-year, retail sales rose at a rate of 4.3% in October, beating expectations for a 3.8% gain, after rising at a rate of 2.3% in September.

Core retail sales, which exclude automobile sales, increased by 0.8% last month, compared to forecasts for a 0.3% rise, after falling 0.3% the previous month.

But the dollar remained broadly supported after the minutes of the Fed's October meeting indicated that officials believe the economic recovery is strong enough to withstand external threats to growth, but offered little additional clarity about when rates could start to rise.

Meanwhile, market sentiment was still under pressure after Japan’s prime minister announced plans this week to delay a sales tax hike due to take place next year, after an increase in April played a part in pulling Japan into a recession.

Sterling was higher against the euro, with EUR/GBP shedding 0.28% to 0.7982.

Sentiment on the euro was vulnerable after market research group Markit said that its preliminary manufacturing purchasing managers’ index fell to 50.4 this month from a final reading of 50.6 in October. Analysts had expected the index to ease up to 50.9 in November.

The bloc's preliminary services PMI declined to 51.3 this month from 52.3 in October, below expectations for a reading of 52.3.

German private sector activity fell to a 16-month low this month, as factory output stalled. The country’s manufacturing PMI fell to 50 and service sector activity also slowed, with the PMI dropping to 52.1 from 54.4

Later in the day, the U.S. was to release data on initial jobless claims, consumer prices, existing homes sales and manufacturing activity in the Philadelphia region.

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