News & Analysis at your fingertips.

We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site.

0

Notifications

Notifications below are based on filters which can be adjusted via Economic and Webinar Calendar pages.

Live Webinar

Live Webinar Events

0

Economic Calendar

Economic Calendar Events

0
Free Trading Guides
Subscribe
Please try again
EUR/USD
Mixed
Oil - US Crude
Mixed
Wall Street
Mixed
Gold
Bullish
GBP/USD
Mixed
USD/JPY
Bearish
More View more
Real Time News
  • Stocks may have brushed aside news the US fiscal package may not arrive before mid-March But, you know what didn't? Treasuries Average of 10Y and 30Y rates at lowest since late Dec Stopped right on the 20-day SMA Overall, coming off March 2020 peaks, but AUG uptrend holds https://t.co/wm0blgxT7D
  • The calls for stimulus will be strong in the United States between Secretary Yellen, Chair Powell and President Biden. Now, is that a benefit to the Dollar for relative risk or a detriment in inflation terms? https://t.co/gMyjKoBekO
  • Heads Up:🇨🇭 World Economic Forum Annual Meeting due at 00:00 GMT (15min) https://www.dailyfx.com/economic-calendar#2021-01-26
  • Heads Up:🇯🇵 BoJ Monetary Policy Meeting Minutes due at 23:50 GMT (15min) https://www.dailyfx.com/economic-calendar#2021-01-25
  • The Bitcoin/Ethereum ratio’s break to its lowest levels since August 2018 suggests that ETH may continue to outperform BTC in the coming weeks. Key levels to watch for Bitcoin and Ethereum. Get your $btc market update from @DanielGMoss here:https://t.co/mo3rw7bP4v https://t.co/UUbjzqhT1p
  • US Senate confirms former Fed Chair Janet Yellen as Treasury Secretary -AFP
  • 🇰🇷 GDP Growth Rate YoY Adv (Q4) Actual: -1.4% Expected: -1.7% Previous: -1.1% https://www.dailyfx.com/economic-calendar#2021-01-25
  • Majority of US Senate votes to confirm Janet Yellen as Treasury Secretary, voting will continue - BBG
  • With latest round of GDP data, South Korea's GDP per capita is now ahead of Italy's. Into G7 territory for the first time.
  • Brief update on my $AUDNZD analyst pick: The pair has confirmed the break under near-term rising support from December 20-day SMA has been taken out 50-day sits below still, may still come into play as key support if losses extend https://t.co/y4quXCd177 https://t.co/6kyGLO7BnR
Mixed US Retail Sales Keep Markets Sketpical on US Economy in 2016

Mixed US Retail Sales Keep Markets Sketpical on US Economy in 2016

Christopher Vecchio, CFA, Senior Strategist

Talking Points:

- Consumption – in spite of the strong US Dollar - remains in a rut as the global economy slows.

- Base effects lead to y/y improvement in retail sales figure.

- EURUSD trades between $1.0804 and $1.0878.

The cornerstone of US economic strength – consumption – is looking increasingly frail heading into 2016. A mixed but mostly disappointing Advance Retail Sales report today has the US Dollar reeling, no matter how you slice it. True, there was a y/y improvement in sales growth, but this is largely due to base effects: there was a sharp -0.7% decline in retail sales growth from last November to December, so a bounce in the yearly figure was all but guaranteed.

Investors are taking the data as a sign that the Fed might be forced to push back against rate expectations. Heading into this year, the Fed said there would be around four rate hikes while the market (per Fed funds) was predicting only two – one in June, one in December. However, after today’s data, it seems the market is even more pessimistic: only one rate hike is now being priced, basically a coin-flip between September and October. We’ve been skeptical of the Fed’s projected rate path given the risks surrounding the US economy, and this data feeds into our skeptical mindset about the US economy and the US Dollar.

Here are the data that’s whipping the US Dollar back and forth this morning:

- USD Advance Retail Sales (DEC): -0.1% as expected, from +0.4% (revised higher from +0.2%) (m/m).

- USD Advance Retail Sales (DEC): +2.2% versus +1.4% prior (y/y).

- USD Retail Sales ex Auto & Gas (DEC): 0.0% versus +0.4% expected, from +0.5% (m/m).

See the DailyFX economic calendar for Friday, January 15, 2016

Chart 1: EUR/USD 1-minute Chart: January 15, 2016 Intraday

Mixed US Retail Sales Keep Markets Sketpical on US Economy in 2016

EUR/USD had been trading in a narrow range all morning and found the mixed US retail sales report to be a bullish catalyst initially/ EUR/USD has since retraced most of its move, having traded at $1.0921 ahead of the report to as high as $1.0983 thereafter. At the time this report was written, EUR/USD was tradding at $1.0943. Similar price action was observed across the USD-complex: initial USD weakness, then fade.

Read more: EUR/GBP Trying to Bottom as BOE Keeps Policy on Hold

--- Written by Christopher Vecchio, Currency Strategist

To contact Christopher Vecchio, e-mail cvecchio@dailyfx.com

Follow him on Twitter at @CVecchioFX

To be added to Christopher’s e-mail distribution list, please fill out this form

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES