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The pound is trading around the same levels against both the euro and the dollar this morning, despite positive economic data released yesterday. A survey which measures the health of the UK retail sector showed that retail sales volumes were viewed as ‘good’ for the first time this year.
The conclusion of the Federal Reserve’s two-day meeting will take place later today and the markets will be watching closely for comments from Fed Chair Jerome Powell. The dollar has strengthened slightly ahead of this.
President Biden will address a joint session of Congress for the first time today. He is expected to reflect on his first 100 days in office and outline his vision for the future.
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GBP: Positive data for the retail sector in April
The pound is still trading around the same levels against the euro and the dollar this morning.
The CBI distributive trades data, which measures the health of the retail sector, came in well above expectations yesterday. It jumped to its highest reading since June 2018 due to the reopening of non-essential shops in April.
Hardware, DIY and furniture sales were significantly above seasonal norms, however clothing and footwear remained below seasonal norms.
In business news this morning, Sainsbury’s has reported a £261m loss despite significant food sales. This is due to extra costs related to the pandemic and the decision not to opt for business rates relief.
GBP/USD chart
EUR: German consumer confidence falls
The euro has been weaker against the dollar this morning, as the greenback has strengthened. The single currency remains around the same levels against the pound.
The consumer confidence figure was released for Germany this morning, falling to -8.8 after rising to -6.1 in the previous month and worse than market forecasts of -3.5. This comes due to increasing infection rates in Germany and tougher restrictions.
It’s a quiet day for data releases, however, economic, industrial and services sentiment figures will be released tomorrow.
USD: Fed meeting concludes today
The dollar is slightly stronger against the euro and a basket of currencies this morning, ahead of the Federal Reserve’s interest rate decision today.
The central bank is expected to leave policy unchanged, so the markets will be looking out for any comments from Fed Chair Jerome Powell on withdrawing monetary support due to the improving US economy.
President Biden will address Congress later today. This will be his first address to a joint session of Congress and he is expected to comment on his first 100 days in office and his vision for the future. It’s thought he may elaborate on his plans for tax hikes.
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