UK Retail Sales Beat Expectations as GBP Holds Ground
UK retail sales surged in January, marking the first increase since August and far exceeding expectations. The data suggests consumers remain willing to spend despite lingering economic uncertainty. Meanwhile, European PMI figures provided mixed signals, with Germany’s manufacturing sector showing modest improvement while services activity slowed. In the US, markets await PMI readings that could shape expectations for the Federal Reserve’s next move.
Key Data Out Today
- UK Retail Sales (MoM – Jan): 1.7% (Previous: -0.6%, Consensus: 0.3%)
- German HCOB Composite PMI (Feb – Prelim): 51.0 (Previous: 50.5%)
- German HCOB Manufacturing PMI (Feb – Prelim): 46.1 (Previous: 45.0%)
- German HCOB Services PMI (Feb – Prelim): 52.2 (Previous: 52.5%)
- Eurozone HCOB Composite PMI (Feb – Prelim): 50.5 (Previous: 50.2%)
- US S&P Global Manufacturing PMI (Feb – Prelim): 51.5 (Previous: 51.2%)
- US S&P Global Services PMI (Feb – Prelim): 53.0 (Previous: 52.9%)
Commodities
- Crude Oil is edging lower, down 0.64% at $72.02 per barrel, as traders weigh supply risks against demand outlooks.
- Brent Oil follows suit, falling 0.48% to $76.11 per barrel.
- Gold is pulling back 0.69% to $2,921 per troy ounce, cooling after recent gains.
- Silver is down 0.52% at $32.77 per troy ounce, tracking broader metal market weakness.
Currency Movements
EUR/USD (1.0481, ↓ 0.19%)
The euro is struggling after mixed PMI data, with Germany’s services sector showing resilience but manufacturing remaining weak. The pair remains under pressure as investors assess the European Central Bank’s rate path.
GBP/USD (1.2665, ↔ Unchanged)
Sterling is holding steady after a sharp rebound in UK retail sales, which exceeded expectations and eased some concerns over consumer spending. However, lingering economic uncertainty is keeping gains in check.
AUD/USD (0.6391, ↓ 0.13%)
The Australian dollar is slipping as softer commodity prices and risk-off sentiment weigh on high-beta currencies. Traders remain cautious ahead of upcoming global economic data.
NZD/USD (0.5764, ↔ Unchanged)
The kiwi is stabilizing after recent gains, with traders digesting the Reserve Bank of New Zealand’s latest policy stance. A lack of fresh catalysts is keeping the currency range-bound.
USD/JPY (150.53, ↑ 0.59%)
The yen is weakening against the US dollar as higher Treasury yields and improved risk sentiment favor the greenback. Investors are watching for any signs of intervention from Japanese officials.
USD/CNY (7.2527, ↑ 0.23%)
The yuan remains under pressure, with markets concerned about China’s economic recovery and the People’s Bank of China’s policy direction. Weak capital flows are keeping the currency on the defensive.
USD/CHF (0.8985, ↑ 0.06%)
The Swiss franc is edging lower as demand for safe-haven assets softens. However, continued uncertainty in global markets is preventing a deeper pullback.
USD/CAD (1.4182, ↑ 0.06%)
The Canadian dollar is struggling as weaker oil prices dampen sentiment. Markets are looking to key US data for fresh direction.
USD/MXN (20.31, ↔ Unchanged)
The peso remains stable, with traders balancing risk sentiment against broader USD movements. The currency has shown resilience despite global uncertainty.
USD/INR (86.66, ↑ 0.22%)
The rupee is under mild pressure, as concerns over global growth weigh on emerging market currencies. The Reserve Bank of India’s policy stance remains in focus.
Market Outlook
Stronger-than-expected UK retail sales are offering some relief for the pound, while mixed PMI data is leaving the euro without a clear direction. Investors will be watching US PMI figures later today for clues on how the Federal Reserve may respond to economic conditions. In commodities, oil markets are retreating slightly after recent gains, while gold is easing as risk appetite steadies.