A relatively quiet week for the British pound, but Sterling did manage to pull off some gains against the majors. Counter currency weakness, risk sent
A relatively quiet week for the British pound, but Sterling did manage to pull off some gains against the majors. Counter currency weakness, risk sentiment and better-than-expected U.K. inflation numbers were likely the main drivers.
United Kingdom Headlines and Economic data
No major catalysts from the U.K. but Sterling trended higher on the session. Risk sentiment was the likely driver as the tone of the market leaned positive, possibly in anticipation of upcoming comments from the new Secretary of Treasury (and former Fed head) Janet Yellen and strong odds of commentary that more stimulus is one the way.
“Consumer prices rose 0.6% in annual terms after a 0.3% increase in November, the Office for National Statistics said. A Reuters poll of economists had pointed to a rate of 0.5%.”
Bank of England’s Bailey expects ‘pronounced recovery’ for economy – “Britain has also now vaccinated more people against COVID-19 than almost any other country, raising hopes of a recovery once the government begins to ease restrictions.”
Output is expected to fall sharply in the quarter ahead (-41).
Domestic orders are expected to decline at a quicker pace next quarter (-37).
Export orders are expected to fall sharply in the three months to April (-44).
Britain’s Office for National Statistics said retail sales volumes rose 0.3% in December, far less than economists’ forecasts in a Reuters poll for a 1.2% increase, leaving them just 2.9% higher than a year earlier.
For 2020 as a whole, retail sales were down 1.9%, the biggest calendar-year fall since these records began in 1996. Clothing sales slumped by more than a quarter and spending on fuel dropped by more than a fifth.