When are the UK retail sales and how could they affect GBP/USD?
|UK retail sales Overview
The UK retail sales, scheduled to be published later this session at 0830 GMT, are expected to drop 0.5% m/m in May, following a 0.0% figure seen in April. Total retail sales are seen arriving at 2.7% over the year in the reported month, down from 5.2% booked previously.
Meanwhile, core retail sales, stripping the basket off motor fuel sales, are seen declining 0.5% m/m while rising 2.5% y/y.
Deviation impact on GBP/USD
Readers can find FX Street's proprietary deviation impact map of the event below. As observed the reaction is likely to remain confined between 10 and 70 pips in deviations up to 3.5 to -1.5, although in some cases, if notable enough, can fuel movements of up to 100 pips.
How could it affect GBP/USD?
FXStreet’s Analyst Haresh Menghani notes: “From a technical perspective, the pair has been in a strong recovery mode over the past couple of trading session and the ongoing momentum could further get extended towards 1.2750-60 heavy supply zone. A convincing break through the mentioned barrier might prompt some additional short-covering move and assist the pair to aim towards reclaiming the 1.2800 round figure mark.”
“On the flip side, the 1.2650 region is likely to protect the immediate downside, below which the pair could extend the pullback but now seems more likely to find decent support and defend the 1.2600 round figure mark.,” Haresh adds.
Key Notes
BoE Preview: Major Banks are forecasting no change in policy today
GBP Futures: upside seen losing traction
EUR/GBP technical analysis: Sellers keep lurking around 21-HMA, immediate resistance-line
About the UK retail sales
The retail sales released by the Office for National Statistics (ONS) measures the total receipts of retail stores. Monthly percent changes reflect the rate of changes in such sales. Changes in Retail Sales are widely followed as an indicator of consumer spending. Generally speaking, a high reading is seen as positive, or bullish for the GBP, while a low reading is seen as negative or bearish.
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