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Unexpected Jump In Retail Sales Data Boost Sterling

Unexpected Jump In Retail Sales Data Boost Sterling

The British Pound has started Friday’s trading on the front foot following another better than expected economic data release.

UK retail sales volumes rose by 1.4% in April 2022 following a fall of 1.2% in March, an outcome that was better than the -0.2% the market was looking for. Food store sales volumes rose by 2.8% in April 2022, mostly because of higher spending on alcohol and tobacco, car fuel sales volumes meanwhile rose by 1.4% in April 2022 following a fall of 4.2% in March when record increases in petrol prices impacted sales.

Additionally, and with a weaker tone to risk appetite, the dollar was on the back foot for much of yesterday with the greenback shedding around 0.8% versus both the euro and sterling. As concerns start to increase surrounding a slowdown in growth, will we see a change in stance from the recent aggressive nature of the Fed?

In level terms, the softer tone to the dollar sees EUR/USD open in the upper half of the 1.05-1.06 range with Cable (GBP/USD) operating above the 1.2460 mark. GBP/EUR also remains somewhat range-bound, continuing to change hands in the top half of the 1.18-1.19 corridor. 

Datawise and turning to the remainder of the day, a quiet docket to end the week with Eurozone flash consumer confidence (May) is the only release of note. The index is forecast to move slightly higher but the reaction is expected to be muted and not significant enough to move the market. 

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