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US Retail Sales – Forex News Trading
US Retail Sales data is released later on today. Watch my weekly Forex news event’s overview here or read my full analysis in order to learn about interpreting these particular data points.
Due: Thursday 13th of August 1:30pm BST
Source:
US Census Bureau
Frequency:
Monthly
Period:
July
Total (m/m)
Prior: -0.3%%
Expected: 0.5%
Low: 0.1%
High: 1.0%
Core (m/m)
Prior: -0.1%
Expected: 0.5%
Low: 0.1%
High: 0.9%
Definitions:
Core: Excludes automobile sales
Description:
This release shows the change in the total value of sales at the retail level. This is a primary gauge of consumer spending, which accounts for the majority of overall economic activity. When consumption demand increases, not only does it show that people have incomes and businesses have revenues, but it also puts upwards pressure on inflation. The ‘Core’ figure excludes automobile sales as they account for about 20% of Retail Sales, and tend to be volatile, thereby distorting the underlying trend. The ‘Core’ data is therefore a better gauge of spending trends.
Summary:
Our fundamental analysis is still bullish on USD. The market is pricing in a rate hike in September or December but this will continue to remain data dependent. Overall the bias for this trade is to the upside, as a good number would match up with fundamentals. Last months print came in way below expectations at -0.3% showing broad weakness. July Retail Sales are expected to rebound and post a solid 0.5% gain which, if on target, would turn up talk for a September rate hike.
Expected Market Reaction:
Historically, US Retail Sales figures can have a huge market impact, especially if the deviation is outside the economists’ high or low estimate. This should continue with the market very sensitive to US data due to an expected upcoming rate hike. We will be looking out for any substantial deviations for a trade, with the bias being to the upside for USD.
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