(MENAFN– ecpulse) European market awaits February`s retail sales data from the United Kingdom with high expectations after a reports released earlier this week showed UK`s consumer price inflation in UK slowed to the lowest level since October 2009 last month.
- Retail Sales Ex. Auto likely rose to 0.3% vs. 1.5% decline
- Retail Sales Ex. Auto dipped to 2.9% vs. 4.8%
- Retail Sales Incl. Auto probably jumped 0.5% after dropping 1.5%
- Retail Sales Incl. Auto likely eased to 2.4% after hitting 4.3%
Expectations, as we can see, are running high for the fourth quarter, as earnings growth strongly influences retail industry, we could actually see some improvement in the figures. Solid retail data would further add more steam to the UK recovery.
Growth data due on Friday is expected to show Gross Domestic Product (GDP) rose by 0.7% between the third and fourth quarter, although annual growth was revised to a slightly-slower 2.7% expansion. The Bank of England forecast growth of 0.9% over the fourth quarter.
GDP expanded by 2.7% over the fourth quarter of 2012, the strongest annual growth pace in any quarter since the first three months of 2008.
The BoE stands pat on its accommodative policy and holding rates at the historic low rate of 0.5% as far as inflation outlook remains in check. With the signs of improvement in the economy and outlook for higher commodity prices inflation might again prove stubborn to return to the 2.0% target set by the BoE.
The rate of consumer price inflation slowed to 1.7 percent in February, in line with expectations, down from 1.9 percent in January. On monthly basis, consumer price inflation increased by 0.5 percent in February.
Lower inflation eases pressure on Bank of England`s Monetary Policy Committee to begin hiking interest rates. However, the brighter picture may add to pressure on the BoE forward guidance, which has set a target for unemployment that says is likely to be reached in 2015.
The pound weakened slightly against the dollar in Europe today, However, the pair would receive support if we see rebound in retail volumes, but if expectations fall short we also might some downside pressure on the pound.
Legal Disclaimer:
MENAFN provides the information “as is” without warranty of any kind. We do not accept any responsibility or liability for the accuracy, content, images, videos, licenses, completeness, legality, or reliability of the information contained in this article. If you have any complaints or copyright issues related to this article, kindly contact the provider above.