UK sales growth slows, German imports fell
British retail sales lagged in February despite a boost from an early Easter. The British Retail Consortium said retail sales values rose 1.9 percent compared with a 2.7 percent increase in February. The total value of sales increased by 3.7 percent in March, down from 4.4 percent last month. BRC data adds hope that Britain’s economy will grow in the first quarter avoiding a third recession within five years.
German imports declined in February for the third time in the last four months. Exports also dropped. Data from the Federal Statistics Office today showed German imports slid 3.8 percent. Exports, that were expected to remain unchanged, dropped 1.5 percent.
On the FX markets, the affirmation of the UK’s sovereign credit rating by the ratings agency S&P on Friday failed to support GBP/USD on Monday, which settled in minor negative territory as market participants remained wary of risks posed to the UK economy given the potential contagion risks stemming from the Euro Zone. In terms of other UK related commentary, the unseasonably cold weather in March damaged sales (-0.9%) on the high street and has increased the prospect of Britain entering a “triple dip” recession, according to new data from BDO. In terms of technical levels, supports are seen at 1.5200, Friday’s low and then at 1.5160 which is the 62% retracement of the latest recovery.