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Sterling Falls to 1.5073 after Weak Retail Sales & BOE MPC Minutes

Posted by Chris Advincula on May 22, 2013 6:56:00 AM

May 22 11:00 GMT

Cable fell sharply by 53 points to the four-week low of 1.5073 from 1.5126 in Europe following the results of the Bank of England’s MPC minutes from its May 8-9 meeting and a weak U.K. retail sales data. Euro-sterling also added to the weakness of the pound as it rose 57 points in Europe to 0.8576 from 0.8519.

The Bank of England minutes voted unanimously for bank interest rates to remain unchanged with the vote as 6-3 and split on quantitative easing. The rates were unchanged since April.  MPC members Mervyn King, Paul Fisher and David Miles continued to campaign for an increase of 25 billion pounds of quantitative easing from the current 375 billion pounds.

The U.K. Retail Sales including fuel fell to -1.3 percent in April, well below the median forecast of -0.1 percent. The previous month was -0.6 percent in March. (revised from -0.7%). The weak sale of summer food items was the cause for the weak Retail Sales this month.

The 21-day and 30-day moving average converged at 1.5145 and fell to 1.5092. The 21-DMA on the other hand, rebounds slightly to 1.5098.

gbp.5.22 resized 600

Chart: FXTrek.com

 

eur.stg.5.22 resized 600

Chart: FXTrek.com

 

Chris Advincula

WorldWideMarkets

 

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