The week’s trifecta of key UK data comes to a close this Thursday, as September’s retail sales reading is released.
Once again sterling has gotten off to a slow start. Cable is down 0.1%, just below $1.32 – which admittedly marks a recovery from yesterday’s sub-$1.315 lows – while against the euro the pound has dipped 0.2%, cementing a one week nadir. The FTSE couldn’t do much with this sterling sluggishness, however, with the UK index falling 0.3% following sizeable losses for Unilever (LON:ULVR), BAE Systems (LON:BAES) and WPP (LON:WPP).
The pound could really do with a surprise retail sales bounce to recover what has been a tough few days of trading. As it stands, however, analysts are expecting a drop from 1.0% in August to -0.1% in September, which would be the worst reading in 4 months.
Providing the backdrop to this data release is the 2 day EU summit in Brussels. While Brexit isn’t the only thing on the cards, from a market perspective it’s likely the most important element. The bloc’s leaders are expected to declare there has been insufficient progress in negotiations with the UK to greenlight parallel trade talks, though reports suggest they will try and do so in such a way to prevent Theresa May’s ongoing leadership crisis from reigniting (which, in and of itself, is a pretty bleak assessment of the PM’s current position).
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