GBP/USD – British pound edges lower despite strong U.K retail sales

GBP/USD has posted slight losses in the Thursday session. In North American trade, GBP/USD is trading at 1.3015, down 0.20% on the day. On the release front, British retail sales jumped 1.1% in March, crushing the estimate of -0.3%. As well, the Bank of England released its quarterly credit conditions survey. Over in the U.S., retail sales is forecast to improve to 0.9% and core retail sales is projected to climb 0.7%. The Philly Fed manufacturing index is forecast to dip down to 11.2, while unemployment claims is projected to rise to 207 thousand. On Friday, the U.S. releases building permits and the Treasury Department releases the semi-annual currency report.

The Brexit drama has taken a short hiatus this week, so investors are paying more attention to economic numbers, particularly consumer spending and inflation numbers. Retail sales impressed in March, with a strong gain of 1.1 percent. This comes on the heels of inflation releases, with CPI unchanged at 1.9%. This is just below the BoE target of 2.0%, so inflation could be a factor in favor of maintaining interest rates at 0.75% at the next policy meeting in early May.

In the U.S., the expectations are for strong retail sales numbers. Retail sales and core retail sales both recorded declines in February, but a rebound is projected for March, with estimates of 0.9% for retail sales and 0.7% for core retail sales. If the actual figures are within expectations, the U.S. dollar could respond with gains.

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GBP/USD Fundamentals

Thursday (April 18)

  • 4:30 British Retail Sales. Estimate -0.3%. Actual 1.1%
  • 4:30 British BoE Credit Conditions Survey
  • 8:30 US Core Retail Sales. Estimate 0.7%
  • 8:30 US Retail Sales. Estimate 0.9%
  • 8:30 US Philly Fed Manufacturing Index. Estimate 11.2
  • 8:30 US Unemployment Claims. Estimate 207K
  • 9:45 US Flash Manufacturing PMI. Estimate 52.8
  • 9:45 US Flash Services PMI. Estimate 55.0
  • 10:00 US Business Inventories. Estimate 0.3%
  • 10:00 US CB Leading Index. Estimate 0.4%
  • 10:30 US Natural Gas Storage. Estimate 82B

Friday (April 19)

  • 8:30 US Building Permits. Estimate 1.30M
  • 8:30 US Housing Starts. Estimate 1.23M
  • Tentative – U.S. Treasury Currency Report

*All release times are DST

*Key events are in bold

GBP/USD for Thursday, April 18, 2019

GBP/USD April 18 at 7:55 DST

Open: 1.3042 High: 1.3053 Low: 1.3003 Close: 1.3015

GBP/USD Technical

S1 S2 S1 R1 R2 R3
1.2729 1.2841 1.2910 1.3070 1.3170 1.3258

GBP/USD was flat in the Asian session and has edged lower in European trade

  • 1.2910 is providing support
  • 1.3070 is the next resistance line
  • Current range: 1.2910 to 1.3070

Further levels in both directions:

  • Below: 1.2910, 1.2841 and 1.2729
  • Above: 1.3070, 1.3170, 1.3258 and 1.3362

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Kenny Fisher

Kenny Fisher

Market Analyst at OANDA
A highly experienced financial market analyst with a focus on fundamental and macroeconomic analysis, Kenny Fisher’s daily commentary covers a broad range of markets including forex, equities and commodities. His work has been published in major online financial publications including, Seeking Alpha and FXStreet. Kenny has been a MarketPulse contributor since 2012.