After showing signs of mild recovery, the latest economic data out of the United Kingdom is proving disappointing. The result of the latest retail sales data is a lower pound, and speculation that things might not be turning around after all.
Instead of gaining by 0.1 per cent, as many economists had expected, retail sales in the United Kingdom fell by 1.3 per cent, reports the Office for National Statistics. This represents a rather large drop — especially when a small gain was expected.
The news comes on the heels of disappointing inflation data. The latest UK economic data indicates that maybe a recovery isn’t on that firm of footing after all. It’s not helping that the latest Bank of England minutes show that, once again, Mervyn King‘s efforts to expand the bond purchase program have failed. As a result, further economic stimulus isn’t forthcoming.
Pound hit a seven-week low against the euro today, and is the second-worst performer among the most developed currencies. Only the yen has performed worse than the pound in terms of major developed currencies. Things aren’t likely to improve dramatically for the pound anytime soon.
At 14:46 GMT GBP/USD is down to 1.5090 from the open at 1.5154. EUR/GBP is up to 0.8563 from the open at 0.8518. GBP/JPY is up to 155.9280 from the open at 155.2750.
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