Latest data released by ONS - 24 May 2019
- Prior +1.1%; revised to +1.2%
- Retail sales +5.2% vs +4.5% y/y expected
- Prior +6.7%
- Retail sales (ex autos, fuel) -0.2% vs -0.5% m/m expected
- Prior +1.2%; revised to +1.4%
- Retail sales (ex autos, fuel) +4.9% vs +4.2% y/y expected
- Prior +6.2%; revised to +6.3%
The readings here are better-than-expected and signals that consumption activity remains robust to start the year. ONS notes that the record growth in the online sector in the three months to April helped to boost the reading here and is largely driven by clothing purchases. But that is offset by the retail sales deflator coming in at just +0.2% y/y, the smallest increase since November 2016 as it is pushed down by Easter sales.
Regardless of the positive sentiment here, the UK economy is still struggling due to Brexit uncertainty and this data point doesn't change that fact. Pound sentiment is still focused on Brexit worries so that is why the reaction to the data is muted.
GBP/USD holds steady at 1.2680 currently, practically unchanged on the release.
