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DailyBubble News

EUR/GBP advances to near 0.8600 amid disappointing UK Retail Sales

EUR/GBP has reversed its recent losses, likely due to the weaker UK Retail Sales data. In April, UK Retail Sales (YoY) declined by 4.4%, falling short of the expected 1.6% growth. This disappointing report caused the Pound Sterling (GBP) to lose ground against the Euro.

On the other hand, Eurozone Retail Sales saw a positive trend, with a 0.7% YoY increase in March after a 0.5% decline previously. EUR/GBP is currently hovering around 0.8580 during the European session on Tuesday.

The British Retail Consortium (BRC) reported that the poor sales performance in the UK was mainly due to unfavorable weather conditions, leading to a challenging start for retailers. Despite this, the Bank of England (BoE) is expected to maintain its interest rates at 5.25% during the upcoming meeting on Thursday.

In contrast, the Eurozone Retail Sales showed signs of improvement, with a 0.8% month-over-month growth in March, surpassing expectations. The European Central Bank (ECB) is anticipated to start cutting borrowing costs in June, as Chief Economist Philip Lane expressed confidence in inflation moving closer to the 2% target.

Overall, the divergence in Retail Sales performance between the UK and Eurozone is influencing the EUR/GBP exchange rate, with market participants closely monitoring central bank actions and economic data for further insights.

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