Technical Bias: Neutral
- GBPUSD climbs to 1-week high in European trade, but consolidates below 1.49.
- UK retail sales rose faster than forecast in February on cheap gas and declining shop prices.
The GBPUSD trimmed gains on Thursday, after climbing to fresh weekly highs on the strength of better than expected retail sales.
The GBPUSD was trading at 1.4892 in the early North American session, relatively unchanged from the previous close. The GBPUSD climbed to an intraday high of 1.4994 in the European session following upbeat UK retail sales. Initial support for the GBPUSD is found at 1.4823. On the upside, initial resistance is likely found at 1.4948.
In economic data, UK retail sales rose faster than forecast in February, as consumers used their fuel savings for other spending. UK retail sales climbed 0.7 percent in February following a 0.1 percent advance the previous month, the Office for National Statistics reported on Thursday. Compared to February 2014, retail sales surged 5.7 percent, well above forecasts calling for 4.7 percent.
Excluding fuel, retail sales were also up 0.7 percent and gained 5.1 percent on the year.
The figures bode well for Britain’s consumer-led recovery. Household consumption has formed the bedrock of the nation’s recovery since the middle of 2013. With wages recovering and inflation slowing, consumers are likely to have more disposable income in the coming months, helping to sustain the consumer-led recovery.