On Thursday the British currency rose against the other major currencies in European trade, after data showed that
UK
retail sales climbed higher than expected in April. The new data spurred hopes that
Britain's
economic growth may accelerate in the second quarter. Data released earlier in the week showed that in April the U.K. slipped into deflation for the first time since 1960.
Sterling surged 0.97% to 1.5687 from around 1.5600 before the data was released.
The Office for National Statistics said in a report that the retail sales including auto fuel expanded 1.2% month-on-month reversing a 0.7% fall in March. Sales were expected to grow 0.4%.
Likewise, excluding auto fuel, sales increased 1.2% after staying flat in March. Economists had forecast a 0.2% rise for April.
Including auto fuel, retail sales growth hit 4.7% on a yearly basis in April from 4% in March outpacing a 3.7% rise forecast by economists.
Retail sales excluding auto fuel also grew 4.7%, but slightly slower than the 4.8% increase seen in March. Sales were expected to rise only by 3.7%.
The
UK
stock market also rose, as miners gained after the release of Chinese manufacturing data. The
FTSE
100 index rose 0.10% or 7.2 points to 7,015.
Data released earlier in the week signaled that the U.K. slid into deflation in April for the first time since 1960, with the annual rate of inflation falling 0.1% after remaining flat in the previous two months.
Meanwhile, the Bank of England commented that record low inflation rates are not likely to continue for long and that consumer prices will rise notably towards the end of the year.
