When are the UK retail sales and how could they affect GBP/USD?

The UK retail sales Overview

The UK retail sales data is expected to drop by -0.6% m/m in December, while on an annualized basis, retail sales are seen ticking higher by 3.0%. In November, retail sales were seen firmer at 1.1% over the month and 1.6% annually. Meanwhile, core retail sales data, excluding fuel, are expected to come in at -0.8% m/m and 1.2% y/y. The report will be published later this session at 0930 GMT.

Deviation impact on GBP/USD

 Readers can find FX Street's proprietary deviation impact map of the event below. As observed the reaction is likely to remain confined between 10 and 70 pips in deviations up to 3.5 to -1.5, although in some cases, if notable enough, a deviation can fuel movements of up to 100 pips.

How could affect GBP/USD?

A positive surprise in the retail sales report could offer fresh impetus to the GBP bulls, taking the rate back towards the 1.3950 barrier. While GBP/USD could breach 1.3805 support should the data show a bigger-than-expected drop in the Dec retail sales numbers. However, the spot could witness significant moves on the UK data, as it is queued up as the first major macro release from the UK docket for this week.

According to Jim Langlands at FX Charts, Technically, “the momentum indicators generally look positive but Cable remains volatile so caution is warranted. Buying dips seem to be the theme though, with an SL placed back below 1.3800.”

Key notes

UK retail sales to fall by -1.0% m/m in December - TDS

Main market movers today - Danske Bank

About the UK retail sales

The Retail Sales released by the Office for National Statistics (ONS) measures the total receipts of retail stores. Monthly percent changes reflect the rate of changes of such sales. Changes in Retail Sales are widely followed as an indicator of consumer spending. Generally speaking, a high reading is seen as positive, or bullish for the GBP, while a low reading is seen as negative or bearish.