Pound Gains against the Dollar for the Fourth Day on Strong February Retail Data

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Pound Gains against the Dollar for the Fourth Day on Strong February Retail DataThe pound extended gains against the dollar for the fourth consecutive day as data indicated U.K retail sales grew in February at a pace that exceeded economists’ estimates more than three times.

The Sterling advanced to a three-week high versus the euro after the Office for National Statistics reported that sales, auto fuel included, grew 1.7 percent last month, up from a decline of 2 percent in January. This exceeded the median estimate of a growth of 0.5 percent in a Bloomberg survey of analysts.

The British Treasury is expected to put up 900 million pounds ($1.5 billion) worth of inflation-tied bonds that mature in 2052 on Thursday.

The pound gained 0.2 percent to $1.6622 as of 10.07 a.m. trade in London, after surging 0.6 percent since Monday. The Sterling rose 0.5 percent to 82.72 pence per euro after earlier hitting 82.66 pence, its highest level since March 6.

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The pound has gained against the basket of 31 major peers over the last 12 months as investors remain optimistic that faster growth will influence the central bank to increase interest rates.

The UK currency has surged 11 percent over the period, making it the best performing among the 10 developed-countries’ currencies, according to Bloomberg Correlation-Weighted Indexes. The dollar has fallen 0.5 percent while the euro has climbed 8 percent.

The implied yield on short-pound futures that expire on December remained slightly unchanged at 0.75 percent on Thursday, while futures expiring in March next year rose 0.95 percent. Since March 2009, the benchmark interest rate set by the Bank of England has remained at a low of 0.5 percent.

To contact the reporter of this story; Jonathan Millet at john@forexminute.com