Sterling weakens on retail sales data

Sterling weakens on retail sales data

Story link: Sterling weakens on retail sales data

TAGS:

The Japanese yen saw gains on Tuesday after comments from a board member of the Bank of Japan that indicated that interest rates in Japan could rise again soon. Atsushi Mizuno said it was incorrect to expect rates to remain where they are until all economic indicators were strong. This led some analysts to believe that the Bank would raise interest rates to 0.5 percent when it meets later this month. Some analysts, however, think that the rate rise won’t come until January if it comes at all, and then will remain at that level for at least half a year.

In mid-afternoon trade in New York the yen had gone up 0.3 percent versus the US dollar and the euro, to ¥115.05 and ¥153.20 respectively. The Japanese currency was 0.7 percent higher in relation to sterling as well as to both the Australian and New Zealand dollars, to ¥226.95, ¥90.37, and ¥78.95.

The Swiss franc was also higher, adding 0.3 percent against the US dollar to SFr1.1915 and also gaining 0.3 percent to SFr1.5868 versus the euro.

The US dollar managed an 0.1 percent gain against the euro, to $1.3305 on new data from the Institute of Supply Management that showed the service sector in the US up from 57.1 in October to 58.9 in November, in contrast to expectations of a decline to 55.5.

Sterling was weaker on the day, dropping 0.3 percent to $1.9730 versus the greenback and falling by the same percentage against the euro, to £0.6750. The UK currency was hurt by low retail sales in November.