EUR/GBP remains subdued near 0.8700 following UK Retail Sales, awaits PMI data

EUR/GBP holds losses after the release of UK Retail Sales data on Friday.
The UK Retail Sales rose 0.5% MoM in September, against the 0.2% decline expected and the 0.6% increase prior.
Traders will observe the preliminary HCOB Purchasing Managers’ Index data from Germany and the Eurozone, along with the S&P Global UK PMI.

Akhtar Faruqui FXStreet

EUR/GBP inches lower after two days of gains, trading around 0.8710 during the Asian hours on Friday. The currency cross holds losses following the United Kingdom (for September. The preliminary readings of HCOB Purchasing Managers’ Index (PMI) from Germany and the Eurozone, along with the S&P Global UK PMI, are scheduled to be released next.

The UK Retail Sales climbed 0.5% month-over-month (MoM) in September after advancing 0.6% in August (revised from 0.5%). Markets projected a 0.2% decline in the reported month. The annual sales grew 1.5%, surpassing the expected 0.6% and 0.7% prior readings. Meanwhile, Core Retail Sales (excluding fuel) rose 2.3% year-over-year, against the expected 0.7% and 1.3% prior.

The UK Retail Sales reported a surprise uptick, though it failed to help the Pound Sterling (GBP) hold ground against its peers amid rising bets of more interest rate cuts by the Bank of England (BoE) in the remaining year.

The British Pound faced challenges after BoE Monetary Policy Committee (MPC) member Swati Dhingra signaled on Thursday that United States (US) tariffs could put downward pressure on prices in the medium term.

The GfK Consumer Confidence Index for the United Kingdom improved to -17 in October, from -19 in September, beating the expected -20 reading as shoppers prepared for Black Friday sales despite lingering concerns about the upcoming Budget.

The EUR/GBP cross gained ground as the Euro (EUR) received support after the European Commission reported the preliminary Consumer Confidence, which improved to -14.2 in October, the highest in 8 months, and up from -14.9 in September, beating market expectations of -15. The stronger consumer confidence in Eurozone economic activity indicated support from lower European Central Bank (ECB) borrowing costs and easing inflation in recent months.

Economic Indicator

Retail Sales (YoY)

The Retail Sales data, released by the Office for National Statistics on a monthly basis, measures the volume of sales of goods by retailers in Great Britain directly to end customers. Changes in Retail Sales are widely followed as an indicator of consumer spending. Percent changes reflect the rate of changes in such sales, with the YoY reading comparing sales volumes in the reference month with the same month a year earlier. Generally, a high reading is seen as bullish for the Pound Sterling (GBP), while a low reading is seen as bearish.

AUD/USD regains mild traction, falters near 0.7150

AUD/USD gathers some steam and manages to flirt with the 0.7150 level on Thursday. However, the pair has retraced some of Wednesday’s significant pullback due to renewed selling pressure on the Greenback and a slight improvement in risk sentiment following hopes of a deal in the Middle East. Wrapping up the Australian docket, the RBA’s Hauser will speak early on Friday.

USD/JPY trades below 160.00 intervention threshold; bullish bias intact

The USD/JPY pair attracts some sellers during the Asian session amid fears that authorities will step in again to prop up the Japanese Yen. Furthermore, the Israel-Lebanon truce prompts some profit-taking around the US Dollar and exerts downward pressure on the currency pair.

Gold puts its 200-day SMA to the test near $4,420

Gold keeps the bullish stance in place in the latter part of Thursday’s session, although a convincing break above the key $4,500 mark per troy ounce still remains elusive. The precious metal’s advance comes amid the resurgence of some selling interest around the Greenback, improving risk sentiment, and declining US Treasury yields across the board.

XRP plummets as ETF outflows, geopolitical tensions reinforce bearish outlook

Ripple (XRP) edges lower, trading around $1.15 at the time of writing on Thursday, its lowest price since February 6. The cross-border money remittance token is extending the sell-off for the fifth consecutive day, reflecting persistent headwinds from ongoing geopolitical tensions and investor uncertainty.

Nonfarm payrolls: Testing the limits of Fed policy patience

The upcoming nonfarm payrolls report for May will provide the final update on the US labor market before Kevin Warsh attends his first policy meeting as the new Fed Chair later this month.

Recession on paper: What really moves the Canadian Loonie now?

Statistics Canada handed the headline writers a gift and the analysts a headache. Real GDP shrank 0.1% on an annualized basis in the first quarter, and with the fourth quarter of 2025 revised down to a 1.0% contraction, that is two negative quarters in a row, the textbook definition of a technical recession and Canada's first since the pandemic.