LONDON: Sterling rebounded on Friday from a sharp fall on Thursday, on track for a second week of gains against the dollar after strong retail sales data and business surveys showed Britain’s economy might already be recovering from its worst annual contraction in 300 years.

British retail sales rocketed last month as consumers prepared for a partial lifting of coronavirus lockdown restrictions, according to official data that also showed record peacetime government borrowing.

Sales volumes leapt by 5.4% in March from February, the Office for National Statistics said. Economists polled by Reuters had expected an increase of 1.5%.

The preliminary “flash” reading of the UK Composite Purchasing Managers’ Index (PMI) rose to 60.0 in April from 56.4 in March, its highest reading since November 2013. A Reuters poll of economists had pointed to a smaller rise to 58.2.

After having erased its gains this week on Thursday, the pound was once again set for a weekly gain on Friday, trading 0.1% higher on the day at $1.3848 by 1415 GMT.

Against the euro, sterling was 0.2% lower at 86.04 pence, having hit its lowest levels in a week against the single currency.

Speculators’ net long position on the pound versus the dollar rebounded in the week to April 13 after slipping to its lowest since February in the previous week, futures data from the CFTC showed.