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Forex - GBP/USD slips lower on downbeat U.K. retail sales

Published 02/20/2015, 05:11 AM
Pound edges lower against dollar after U.K. data
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Investing.com - The pound slipped lower against the U.S. dollar on Friday, after the release of disappointing U.K. retail sales data and as concerns over Greece continued to dampen market sentiment.

GBP/USD hit 1.5353 during European morning trade, the pair's lowest since February 18; the pair subsequently consolidated at 1.5384, shedding 0.19%.

Cable was likely to find support at 1.5206, the low of February 12 and resistance at 1.5483, the high of February 18.

In a report, the Office for National Statistics said U.K. retail sales fell 0.3% in January, compared to expectations for a 0.2% downtick. December's figure was revised to a 0.2% gain from a previously estimated increase of 0.4%.

Year-on-year, U.K. retail sales rose at a rate of 4.8% last month, below expectations for a 5.9% increase and after a downwardly revised 3.8% gain in December.

A separate report showed that U.K. public sector net borrowing dropped by £9.40 billion January, more than the expected decline of £7.80 billion. December's figure was revised to a £9.87 rise from a previously estimated £12.47 increase.

Meanwhile, investors remained cautious as another round of talks with eurozone finance ministers was set to take place on Friday after Germany rejected a proposed bailout extension request from Greece.

The Greek request included a pledge to maintain "fiscal balance" for a six-month period, in order to give it time to reach a new agreement on growth over the next four years with its partners in the euro zone, Reuters reported.

But German Finance Minister Wolfgang Schaeuble said it was "not a substantial proposal for a solution" and did not meet the criteria agreed on at the euro group meeting of euro zone finance ministers on Monday.

Sterling was steady against the euro, with EUR/GBP at 0.7379.

Also Friday, research group Markit said that Germany's preliminary manufacturing purchasing managers' index remain unchanged at 50.9 in February, disappointing expectations for a rise to 51.5.

Germany's preliminary services PMI rose to 55.5 this month from a reading of 54.0 in January, compared to expectations for an increase to 54.2.

Markit also reported that France's preliminary manufacturing PMI slipped to 47.7 this month from 49.2 in January. Analysts had expected the index to rise to 49.5 in February.

France's preliminary services PMI rose to 53.4 in February from 49.4 last month, exceeding expectations for an increase to 49.8.

Later in the day, the U.S. was to release preliminary data on manufacturing activity.

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