Better than expected retail sales figures in the UK with downwards revisions not hurting too much. Headline retail sales jumped 2.3%, nearly triple the early expectations, with a small downwards revision from -1% to -1.4%. Year over year, we have a rise of 5.2% after 2.3% and against 3.6% expected. Excluding fuel, it is 2.3% m/m and 5% y/y.
GBP/USDÂ initially ticked higher abut is reacting negatively in the aftermath.
In addition, the public sector net borrowing figures show -11.8 billion bounds against -13.9 billion, which means a lower income for the government. Is that what is weighing on sterling? It is usually a second tier figure.
The United Kingdom was expected to report a rise of 0.8% in retail sales in January after a drop of 1% in December (before revisions). Year over year, a rise of 3.6% was on the cards after 2.6%. Excluding fuel, a rise of 0.7% m/m and 3.5% y/y were on the cards.
GBP/USD traded around 1.4325 towards the publication, somewhat pressured due to the events in Brussels. There was no particular front running towards the publication.
The EU Summit in the Belgian capital focused on the UK’s negotiations with the union. All night negotiations were inconclusive. According to reports, UK PM David Cameron raised his demands and this put off his counterparts. Eventually, he will want to show his toughness but return with an agreement and proceed with the referendum.
More: UK jobs report looks good – GBP/USD slowly buying it
