FX round-up: Sterling up on UK retail data as dollar drops after Fed's jawboning
Sterling firmed on key crosses Thursday, helped up by a slight improvement in UK retail-sales figures, a widely weaker dollar on perceived Federal Reserve jawboning and lingering Eurozone political uncertainty.
At about 17:16 GMT, sterling was up 0.84% to $1.255, and up 0.57% to €1.1859. Same time, the dollar-spot index was down 0.29% to $100.930.
The British unit made modest gains on the aussie and loonie, but achieved more limited traction on the kiwi, rand and yen.
Michael Hewson, chief market analyst at CMC Markets UK, attributed sterling's rise to CBI retail sales data, which showed an improvement on the January numbers.
CBI's Distributive Trades Survey showed a balance of 9% more retailers reporting a rise in sales volumes over those seeing falls, after the 8% decline in the previous report.
Looking to March sales, retailers expected volumes to rise again, but at a slightly slower pace.
Meantime, FXTM research analyst Lukman Otunuga said political uncertainty enshrouding the Eurozone has left the bloc's currency vulnerable to heavy losses this week.
"From a technical standpoint, the EURUSD has come under renewed selling pressure on the daily timeframe with sellers exploiting the downside momentum to take prices lower towards $1.0500," said Otunuga.
"A decisive breakdown below $1.0500 could encourage a further decline lower towards the next relevant support at $1.0350."
At 17:16 GMT, the dollar was down 0.23% to €0.9449, faltering also against the currencies of Australia, Canada, New Zealand, South Africa and Japan.
Hewson said the dollar's decline followed last night's Federal Open Market Committee minutes, which proved to be every bit as unenlightening as most had expected them to be.
He added that the odds of a hike in May were overtaking the prospects of a move in March, with the phrase "fairly soon" being interpreted as not in March.
Jasper Lawler, senior market analyst at London Capital Group, added that the FOMC minutes had offered up the "usual meaningless vagaries".
He said the phrase "fairly soon" could be spun either way to suit one's existing market bias.