Further to yesterday’s update regarding the Bank of England’s ‘kick it while it’s down’ attitude to sterling’s chances of a good open to 2020, vital retail sales figures and inflation data, which will be released at 09:30 GMT this morning, will set the tone for the all-important BoE meeting on January 30th.
The pound’s chances of uplift are very much pinned to these figures in the short-term, with December being the most critical month regarding large-scale Christmas shopping, which usually provides a boost to GBP pairs. However, with newspapers reporting on an almost daily basis about the ailing health of the high street – with established department store chains such as Debenhams, Mothercare and Beales all calling in the administrators in recent months – there is a distinct possibility that Brits will buck the trend of spending even when times are tough, as uncertainty creeps into consumer sentiment.
A modest increase in retail sales of 2.0% month-on-month has been forecast, any deviation from this is likely to shake sterling’s foundations as the markets price in the likelihood of a rate cut from the BoE in their meeting at the end of the month.
Have a great day.
Author: Joshua Haden-Jones, Private Relationship Manager
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