Retail sales miss

Euro up
The outgoing Greek prime minister is one of those people who can lighten the mood of a summit meeting simply by not turning up. At least, news of his resignation yesterday lightened the mood of the euro. It was the day's top-performing major currency.

With a new bailout deal sealed and a scheduled repayment to the European Central Bank made on time Alexis Tsipras decided, to no great surprise, that the time had come for another general election. After all, the austerity policies he has pushed through in the last few weeks bear no resemblance to his manifesto in January and are completely at odds with the referendum he held at the beginning of July.

Investors are entirely relaxed about the situation. If Mr Tsipras is returned to power they expect it to be at the head of a more centrist coalition that will continue with the reforms and cuts demanded by Greece's creditors. The euro strengthened by one and a half US cents and by one and three quarter cents against sterling.

Sterling down
The pound remains vulnerable to soft UK economic data. It took a dive on Thursday morning following another set of suboptimal retail sales figures. Sterling was not the day's weakest major currency but it was in the back half of the field.

Retail sales growth of 0.1% in July was not even enough to offset the previous month's decline. The 4.2% year-on-year increase was alright but it fell short of the expected 4.4% increase. The reading of -1 for the CBI's Industrial Trends survey was better than forecast but it still means there have been negative readings for five of the last six months. None of the numbers was bad but together they contributed to a mood of disappointment.

Investors were no more upbeat about the North American dollars. Both of them struggled alongside the pound despite better-than-expected figures for US existing home sales and Canadian wholesale sales. The krone was hurt by news of a surprise -0.1% contraction in Norway's economy during the second quarter and the Australian dollar was wounded this morning by further weakness in one of the Chinese purchasing managers' indices.

Loonie tops today's bill
Two important sets of Canadian data come out this afternoon, measuring inflation and retail sales. Both have the potential to move the Canadian dollar. There will also be a dozen provisional PMI readings from Europe and the States. 
The only UK ecostat is for public sector borrowing. It is not a figure that often affects the pound.

Finally, a point to ponder. Three currencies with strong ties to the US dollar have devalued recently; the Chinese yuan, the Vietnamese dong and the Kazakhstani tenge (rhymes with dengue not Penge). More than 30 other currencies are pegged, one way or another, to the dollar. It would not be a surprise if some of them - perhaps the Middle Eastern oil producers - made similar moves. Have a good weekend.