UK retail sales rose at their quickest annual rate in 14 years in October, bolstered by cold weather and Halloween sales at supermarkets. The Office for National Statistics said that sales volumes in October were up 7.4% from a year earlier.
The pound hit a two-month high against the euro on Thursday, following the retail sales figure, and as investors focused on the political risks facing Europe in the coming months.
US consumer prices recorded their biggest increase in six months in October, mainly due to rising petrol costs and rent. This suggests a pickup in inflation that could potentially clear the way for the Federal Reserve to raise interest rates in December.
The Dollar slipped against a basket of currencies on Thursday, falling from a multi-year peak as traders digested remarks from Federal Reserve Chair Janet Yellen. Yellen, in both her prepared remarks and subsequent comments to Congress, strongly suggested that an interest rate hike is on the cards for December.
Trump has been critical of the central bank leader, and has suggested that he would replace her at some point. He has suggested that Yellen should be "ashamed" of her actions, saying her policies were political positions to help President Obama. Amid expectations that Trump would step up pressure on the Fed after he takes office in January, there was concern that Yellen might just decide to step aside. "No I cannot," she said when asked if there were any circumstances under which she might leave before her term expires. "I was confirmed by the Senate to a four-year term, which ends at the end of January of 2018, and it is fully my intention to serve out that term." Though she did not address the current political situation directly or even Mr Trump's name, Yellen stressed the need for central bank independence.
She also said that the economy had strengthened further since the Fed’s last meeting, and that inflation was moving up. Yellen said that "near-term risks to the outlook were roughly balanced". She expected prospects for the US economy to improve and for inflation to rise to the target rate of two per cent over the coming years.
14:30 – USD :Vice Chair of FOMC Richard Dudley Speaks