The pound lost a third of a per cent against the US dollar and euro following softer-than-expected UK inflation figures and a mixed bag of US data.
The Canadian dollar rose higher yesterday as investors debated the risk sentiment surrounding the US dollar as multiple US data points missed expectations.
Producer prices in the US fell 0.5% in October, the most since April 2020 and missing market expectations of a 0.1% increase. Prices for goods dropped 1.4%, largely due to a 15.3% drop in petrol prices.
US retail sales fell 0.1% in October, marking the first decline in seven months and following an upwardly revised 0.9% in September. Sales fell across the board but notably so in furniture stores and vehicle dealers.
Following this data, the gold price dropped but remains upbeat on a broader scale.
Yesterday, Eurostat reported the euro zone’s economic forecasts for 2023 were lowered to 0.6%, less than the previously forecast 0.8% expansion. This revision comes as high inflation, rising interest rates and weak demand continue to take their toll on the eurozone. The largest economy within the euro area, Germany, is expected to contract by 0.3% this year.
UK house prices fell by 0.1% in September, marking its first decline in more than a decade, taking the average house price to £291,385. This was down from £292,882 in August.
This morning UK chocolatier, Hotel Chocolat agreed to be taken over by food giant Mars in a £534 million deal. The takeover is a move taken to help Hotel Chocolat expand internationally. Following the takeover, the chocolatier’s shares surged 164% from 139p to 369p.
British fashion house, Burberry, reported a slowdown in trading as the weakening demand for luxury goods continued to bite. If demand remains as it is, Burberry says it is unlikely to achieve its revenue guidance for the 2024 financial year.
It’s relatively quiet on the data front today, with just a few speeches from central bankers. Tomorrow. UK retail sales are forecast to expand 0.2% in October and in the afternoon, US building permits are expected to grow to 1.45 million.
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