The dollar confounded analysts this afternoon by shrugging off weaker-than-expected US data on retail sales and industrial production to edge higher against the euro in late London trading. At 1715, the euro was trading at USD1.1760, while against sterling it was at STG0.6969. However, analysts noted that trading was quiet and small trades were having a disproportionate effect on values. The euro had earlier made a run up to USD1.18, but a rumoured option barrier at that level prevented the single currency from making lasting gains.
This was despite news this afternoon of a 0.3pc drop in October US retail sales, following a 0.4pc decline in September. This was the first back-to-back fall in sales in 21 months. Meanwhile, US industrial production rose just 0.2pc in October - half the gain expected by the market. Still, US economists expressed optimism about results going forward. They highlighted the marked improvement in manufacturing survey data, and the positive indications for the all-important Christmas sales season from consumer confidence figures//www.fxcentre.com