The BRC survey report published earlier today in Britain hinted that consumers were cautious of making purchases in October despite an improvement in their household incomes and lack of inflationary pressures in the nation. However, the BRC also predicted that the holdup was in anticipation of discounts and deals on Black Friday that typically falls at the end of November, thus boosting the retail sales growth outlook. Tomorrow, Sterling investors focus will shift towards the September employment report and October’s tally for the claimant count.

In Europe, with concerns about growth starting to ease out, today’s update indicated that Italy’s industrial production bounced back in September, while French industries only reported modest activity growth. Across the Atlantic, NFIB small business sentiment data is scheduled for release later today.

Pound Sterling – UK Markets

A survey by the British Retail Consortium (BRC) earlier today indicated that October was a somewhat disappointing month for UK retailers as growth in retail sales cooled down on a like-for-like basis compared with the same month last year. The drop in October stripped down the healthy retail sales growth witnessed in the previous month, although those figures were distorted by the timing of the end of summer bank holiday. The BRC, meanwhile, predicted that the slowdown was partly due to shoppers refraining from splurging on purchases of small household appliances ahead of the November ‘Black Friday’ sales. The event which falls at the end of November has become very popular in Britain in recent years and leads to heavy discounting on electronic and electrical goods. The economic release, however, had little influence on trading in the Pound against the major currencies this morning.

Meanwhile, Sterling is currently seen struggling to maintain its gains against the common currency. Amid the absence of further UK macroeconomic indicators, investors will look ahead to tomorrow’s UK employment figures and a speech by the BoE Governor.

US Dollar – US Markets

The US Dollar pulled back and gave up some of its gains against the shared currency in yesterday’s trading session as speculation moved on from the timing of the Federal Reserve’s interest rate rise in December meeting, to how quickly the next ones would follow. The US Dollar – Japanese Yen currency pair had early yesterday found an initial upside, but losses in the Japanese currency pair faded later in the day as risk appetite came under pressure.

This morning, the US Dollar has edged higher against Sterling and the Euro. In another light economic calendar day in the US, market participants will eye new figures on sentiment in the US small business sector later today. The stellar performance by the US nonfarm payrolls report on Friday implied that the macro trend is gaining momentum. Investors will keep a tab on today’s sentiment data for small businesses, which in particular, contributes to the labour market’s strong performance. A marginally higher number for today’s optimism benchmark could add to further evidence that the macro outlook is considerably brighter for the coming months.

Euro – European Markets

Yesterday, the shared currency slipped lower against the US Dollar. The Euro had initially recovered from some of its previous week’s losses and was trading higher against its key peers, but latest growth forecasts published by the OECD later in the day pressured the common currency. In its semiannual economic forecasts, the OECD predicted that the 19-nation currency union would continue to lag behind the US, while growing at a rate of 1.5% this year, 1.8% in the next year and 1.9% in 2017. Also, the OECD advised that the ECB policymakers should build on the moderate recovery in Europe, kick started by the central bank through its aggressive asset purchase programme to create more lasting economic dynamism.

This morning’s September industrial production data in Italy has provided fresh insights to stay positive about Euro area’s growth momentum in the coming months. Italy’s industrial activity rebounded in September, though the pace of activity growth was slightly slower than anticipated. Meanwhile, French industrial sector showed modest rate of activity in September, matching estimates.

Other Currencies – Highlights

The Aussie Dollar has currently edged higher against the greenback. Data released earlier today revealed that Australia’s home loan approvals ticked up in September, surpassing market estimates of a flat reading. However, value of total housing finance sharply fell during the month, indicating slower credit growth ahead. Also, the ongoing weakness witnessed in weekly auction clearance data also points to an imminent slowing of loan growth in the coming months. Falling auction clearance rates, weaker credit growth and higher mortgage rates in recent weeks signals a softer housing market outlook. In separate data, NAB business confidence saw a slight decline, but the NAB business conditions index remained steady at relatively high levels for October. However, mixed Australian data had little impact on trading in the currency pair.

Elsewhere, in China, Australia’s largest trading partner, consumer prices came in noticeably below expectations for October despite the Chinese central bank’s relentless efforts to boost demand in the nation. The Aussie Dollar nudged lower against the US Dollar, following the economic data release.