U.K. retail sales soar 1.7% in February, pound spikes higher

Retail sales in the U.K. rose much more than expected in February, underlining optimism over the country’s economic outlook, official data showed on Thursday.

U.K. retail sales soar 1.7% in February, easily surpassing expectations

In a report, the U.K. Office for National Statistics said retail sales increased by a seasonally adjusted 1.7% last month, blowing past forecasts for a gain of 0.5%. Retail sales in January was revised down to a 2% drop from a previously reported decline of 1.5%.

Year-on-year, retail sales rose at an annualized rate of 3.7% in February, above expectations for a 2.5% gain, after rising at a rate of 3.9% in January.

Core retail sales, which exclude automobile sales, jumped 1.8% last month, easily surpassing forecasts for a 0.3% gain, after declining 2% in the preceding month.

Following the release of the data, the pound turned higher against the U.S. dollar, with GBP/USD rising 0.34% to trade at 1.6638, compared to 1.6569 before the data.

Meanwhile, European stock markets were mixed. London’s FTSE 100dipped 0.3%, the DJ Euro Stoxx 50 inched up 0.25%, France’s CAC 40was little changed, while Germany's DAX increased 0.15%.