British retail sales data is due at 0930 GMT, the headline UK retail sales volumes dipped by 0.3% in January, following strong growth over the October-December period, leaving the underlying 3m/3m pace of growth at a firm 2.3%, the strongest since 2002. Growth has been supported in recent months by the decline in inflation, the pickup in earnings growth, and buoyant consumer sentiment.
Available indicators for February point to some easing in the pace of growth, with notably weaker responses in the CBI Distributive Trades survey at 1100 GMT.
"In what are highly volatile data at the best of times we look for a modest 0.3% monthly volume gain on both the headline and ex-fuel series", said Lloyds Bank in a report. The CBI survey will later provide the first indications for spending in March.
In a quiet day for US data, the weekly initial claims is of most interest. The sharp fall in claims in the first half of March suggests that the back up in February was weather related rather than a signal that the improvement in the labour market is faltering. Today's reading is for the week after the survey date of the March payrolls report but it will still provide a timely update on the strength of the labour market.
Accroding to Lloyds Bank, the 'flash' PMI services estimate is expected to be little changed in March. So far this has proved to be a poor leading indicator of the more popular ISM data and so usually gets little market attention. Fed speakers Bullard and Lockhart will provide further updates on the monetary policy outlook. As a current voter, Lockhart's views are of particular interest.
