Forex - Pound rises after robust U.K. retail sales report

The pound rose to more than one-week highs against the dollar on Thursday after data showing that U.K. retail sales jumped higher in February underlined optamism over the rapid economic recovery.

Pound strengthens after upbeat U.K. retail sales report

GBP/USD hit highs of 1.6640, the strongest since March 19 and was last up 0.25% to 1.6622.

Cable was likely to find support at 1.6553, the session low and resistance at 1.6665, the high of March 17.

The Office for National Statistics said U.K. retail sales rose 1.7% in February; recouping most of January’s 2.0% decline, and were 3.7% higher from a year earlier.

Market expectations had been for a 0.5% increase on the month and an annual gain of 2.5%.

Core retail sales, which exclude automobile sales, jumped 1.8%, outstripping forecasts for a 0.3% gain, after falling 2.0% in January.

Retail sales growth was led by food stores which contributed more than half of the overall increase in sales volumes, the ONS said.

Sterling rose to three-week highs against the euro, with EUR/GBP down 0.46% to 0.8275.

The single currency remained under pressure on Thursday after European Central Bank officials indicated earlier in the week that they are considering fresh policy options to stave off the risk of deflation in the region.

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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%.

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U.S. oil futures steady near 2-week high on Russia concerns

U.S. oil futures swung between small gains and losses to hold near a two-week high on Thursday, as investors worried tougher sanctions against Russia could lead to a disruption to supplies.

WTI oil holds steady near 2-week high amid concerns over harsher Russia sanctions

On the New York Mercantile Exchange, West Texas Intermediate crude oil for delivery in May held in a range between $100.06 a barrel and $100.41 a barrel.

Nymex oil last traded at $100.11 a barrel during European morning hours, down 0.15%, or 15 cents.

The May contract rose to $100.46 a barrel on Wednesday, the highest since March 11, before trimming gains to settle at $100.26 a barrel, up 1.08%, or $1.07.

Futures were likely to find support at $99.10 a barrel, the low from March 26 and resistance at $101.51 a barrel, the high from March 11.

Oil prices rallied on Wednesday after President Barack Obama urged Europe not to get complacent over Russia's recent annexation of Crimea.

Speaking in Brussels, Obama told allies complacency against Russia could have serious consequences, including stiffer sanctions slapped on Russia if Moscow makes new incursions into Ukraine.

Russia is the world’s biggest energy producer.

Meanwhile, market players awaited the release of key U.S. data later in the session for further indications on the strength of the economy and the future course of monetary policy.

The U.S. is to publish final data on fourth quarter economic growth, as well as the weekly report on initial jobless claims and private sector data on pending home sales.

Upbeat U.S. durable goods orders figures on Wednesday indicated that economy is gaining momentum in the wake of a weather-induced slowdown.

Elsewhere, on the ICE Futures Exchange in London, Brent oil futures for May delivery eased down 0.11%, or 12 cents, to trade at $106.91 a barrel, while the spread between the Brent and U.S. crude contracts stood at $6.80 a barrel.

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