26 Mar 2015
Better than expected UK retail sales fails to offset declining prices – BBH
FXStreet (Barcelona) - The Brown Brothers Harriman Team notes that strong UK retail sales failed to offset declining prices, with the retail sales deflator falling 3.6% from year ago, warning that UK CPI risks a negative dip.
Key Quotes
“The UK reported a much stronger than expected February retail sales data. Sterling ticked up on the news, but sentiment is checked by uncertainty surrounding the May election and ideas that a BOE rate hike is still more than a year away. Last week's Fed-spike high was near $1.5165.”
“Sterling has not been above $1.50 this week and above the 20-day moving average comes in near $1.5020. Sterling has not traded above that average since March 3.”
“Headline retail sales rose 0.7%, and the January series was revised to 0.1% from -0.3%. The market had forecast a 0.4% increase.”
“However, the increase in sales comes at the cost of falling prices. The retail sales deflator fell 3.6% from a year ago, the largest drop since the time series began almost 20 years ago. It warns of the risk that UK CPI can fall into negative territory as well.”
Key Quotes
“The UK reported a much stronger than expected February retail sales data. Sterling ticked up on the news, but sentiment is checked by uncertainty surrounding the May election and ideas that a BOE rate hike is still more than a year away. Last week's Fed-spike high was near $1.5165.”
“Sterling has not been above $1.50 this week and above the 20-day moving average comes in near $1.5020. Sterling has not traded above that average since March 3.”
“Headline retail sales rose 0.7%, and the January series was revised to 0.1% from -0.3%. The market had forecast a 0.4% increase.”
“However, the increase in sales comes at the cost of falling prices. The retail sales deflator fell 3.6% from a year ago, the largest drop since the time series began almost 20 years ago. It warns of the risk that UK CPI can fall into negative territory as well.”