GBPJPY Pound Sterling vs Japanese Yen

The pound advanced against its most major counterparts in early European deals on Thursday, after a data showed that U.K. retail sales increased more than expected in July.

Data from the Office for National Statistics showed that retail sales including auto fuel, rose 0.7 percent month-on-month in July, in contrast to a 0.5 percent fall in June. Sales were forecast to increase by 0.2 percent.

Excluding auto fuel, retail sales volume climbed 0.9 percent over the month, while it was forecast to remain flat.

On a yearly basis, overall retail sales volume growth accelerated to 3.5 percent in July from 2.9 percent a month ago. Economists had expected sales to grow at a stable rate of 2.9 percent.

Sales, excluding auto fuel, also grew 3.7 percent annually in July versus the expected increase of 2.8 percent.

European shares rose as the Turkish lira rallied further ahead of a presentation by Finance Minister Berat Albayrak to investors and China said it would hold a fresh round of talks with the United States later this month, in an effort to diffuse tensions.

The pound rose back to 1.2733 against the greenback, from a low of 1.2686 hit at 8:15 pm ET. The next likely resistance for the pound is seen around the 1.30 level.

The U.K. currency remained higher against the yen with the pair trading at 140.82. This follows a low of 140.21 hit at 8:00 pm ET. The pound is likely to challenge resistance around the 142.00 level.

Data from the Ministry of Finance showed that Japan recorded a merchandise trade deficit of 231.2 billion yen in July.

That was shy of expectations for a shortfall of 41.2 billion yen following the downwardly revised 720.8 billion yen surplus in June.

The pound edged up to 1.2639 against the franc, reversing from a low of 1.2605 touched at 8:00 pm ET. If the pound rises further, 1.29 is likely seen as its next resistance level.

On the flip side, the pound declined to a 6-day low of 0.8960 against the euro, following an advance to 0.8933 at 5:00 pm ET. On the downside, 0.91 is possibly seen as the next support level for the pound.

Preliminary data from Eurostat showed that euro area trade surplus decreased for a third straight month in June, albeit slightly.

The seasonally adjusted trade surplus fell to EUR 16.7 billion from EUR 16.9 billion in May. Economists had expected the figure to remain unchanged at May's level.

Looking ahead, Canada manufacturing sales for June, U.S. housing starts and building permits for July and weekly jobless claims for the week ended August 11 are scheduled for release in the New York session.

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