020 7898 0500Sterling pushed to its highest level against the US dollar since September after retail sales exceeded markets’ expectations. This will be encouraging news as data of late has been sluggish and to the downside. Retail sales jumped by 2.3% against an expectation of 1%, with warmer weather helping push numbers higher.
This is in stark contrast to the big decline we saw last month. There was some concern that with the increase in inflation, outlook for Brexit and the forthcoming general election, we could have seen further strain on consumer spending. Year on year sales were up 4%.
In the meantime, the Conservatives released their political manifesto. Theresa May stated that a strong economy and delivering Brexit were top priorities. They dropped the 2015 pledge not to raise income tax or National Insurance and there are big changes to social care funding in England.
In addition, they have scrapped the triple-lock on the state pension, which guaranteed it rose by average earnings, inflation or 2.5% – whichever was highest. With the Liberal Democrats, Labour and the Conservatives all releasing their manifesto, it will be interesting to see what the electorate now think and if opinions have been changed from the early forecast of a 100-seat gain for the Tories.
It is a quiet end to the week after a busy schedule of higher inflation, lower wage inflation and bumper retail sales. However, all eyes will be on whether sterling can hold on to its gains moving into the end of the week.
