The GBP/USD price is on track for the second consecutive weekly gain as forex traders react to the latest UK retail sales data. It is trading at 1.3865, which is up by 0.25% from Thursday’s low of 1.3823.
UK retail sales numbers
The UK government has done a relatively good job in delivering the coronavirus vaccination. Recent data shows that more than 33 million people have received the vaccination. This is about half the population, which is an impressive feat. As a result, the government has started to reopen its economy while the number of cases have continued to drop.
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The impact of this performance is being seen in the recent economic numbers. Early this week, data by the Office of National Statistics (ONS) revealed that the unemployment rate dropped to 4.9% in February this year. Further data revealed that consumer prices are starting to pick up again.
In a report today, the ONS revealed that the UK retail sales continued to do well in March. The headline retail sales rose by 5.4% in March after rising by 2.1% in February. On an annualised basis, the sales rose by 7.2% after dropping by 3.7% in February. The year-on-year number rose sharply because sales declined in March 2020 as the country went into lockdown.
The UK core retail sales increased by 4.9% in March after rising by 2.4% in the previous month. This growth led to a year-on-year increase of 7.9%, up from the previous decline of 1.1%. This trend will likely continue as many non-essential retailers start to reopen.
The GBP/USD will also react to the latest flash manufacturing and services PMI numbers by Markit. Analysts expect that the two PMIs rose from 58.9 and 56.3 in March to 60 and 58 in April, respectively. Later, the pair will react to the latest flash PMI from the United States and the new home sales data.
GBP/USD technical forecast
The GBP/USD pair rose slightly after the impressive UK retail sales numbers. On the four-hour chart, the pair is still below this week’s high of 1.4000. It is also below the 25-day and 15-day moving averages and the important resistance at 1.3915. The pair’s path of least resistance is to the downside, which could see it fall to 1.3800. However, a move above the important resistance at 1.3900 will open the possibility of it rising to 1.400.