US Retail Sales Beat Expectations – USD Follows
US retail sales finally shine: headline sales are up 0.6% in July, on top of a significant upwards revision for June: 0.3% against 0.2% originally reported. Core sales are up 0.5% against 0.3% and also on top of an upwards revision. The control group is up 0.6% instead of 0.4% and also here, it comes on top of 0.1% instead of 0.1%.
The US dollar is higher across the board on this much-needed positive surprise after a long list of disappointing data.
Retail sales in the US were expected to rise by 0.4% in July after falling 0.2% in June (before revisions). Core sales carried expectations for a rise of 0.3% after -0.2% and the control group was predicted to advance by 0.4% after a slide of 0.1% in the previous month.
In a separate report, the New York Fed Manufacturing Index was projected to tick up from 9.8 to 10 points.
The US economy is all about consumption. This time, the retail sales report is published on its own, without the distraction of the inflation figures.
The US dollar has been on a path of recovery:
- EUR/USD was sliding from the highs, also due to a small miss on German GDP.
- GBP/USD was hit by the recent Brexit negotiations and the miss on UK inflation.
- USD/JPY surged as tensions with North Korea ease.
- USD/CAD traded well above 1.27.
- AUD/USD was falling further away from 0.79.
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