Talking Points:

- Consumption above expectations again, further evidence economy stronger than anticipated.

- Implies Q1 growth may still hold +2.0% after several months of disappointing data.

- USDJPY briefly trades back to ¥102.00.

The consumption figures in the March US Advance Retail Sales report beat estimates across the board, helping disperse fears of a more concerted slowdown in the world’s largest economy. In an encouraging development, the Retail Sales Control Group figure – which is used in computing the headline GDP figure – beat expectations as well, giving some hope to a modest Q1’14 growth figure near +2.0%.

The data today rounds out weeks of generally disappointing data out of the United States, with the March US Nonfarm Payrolls report disappointing expectations and the Federal Reserve taking on a more dovish tone in their latest meeting minutes. The Advance Retail Sales report showed the strongest consumption gains since September 2012.

Here’s the data that lifted the US Dollar this morning as US Treasury yields edged up slightly:

- Advance Retail Sales (MAR): +1.1% versus +0.9% expected, from 0.7% (revised higher from +0.3%) (m/m).

- Retail Sales ex Auto (MAR): +0.7% versus +0.5% expected, from +0.3% (m/m).

- Control Group (MAR): +0.8% versus +0.5% expected, from +0.4% (revised higher from +0.3%) (m/m).

USDJPY 1-minute Chart: April 14, 2014 Intraday

USDJPY-Catches-102-on-Best-US-Retail-Sales-since-September-2012_body_x0000_i1027.png, USD/JPY Catches ¥102 on Best US Retail Sales since September 2012

Charts Created using Marketscopeprepared by Christopher Vecchio

The USDJPY jumped to its daily high on the back of stronger yields around improved US consumption data, trading as high as ¥102.01 at the time this report was written. The pair had traded at 101.84 ahead of the data release, and was trading at 101.88 at the time of publication. US Dollar strength was noted elsewhere, with the EURUSD trading lower from $1.3827 to as low as 1.3809.

--- Written by Christopher Vecchio, Currency Analyst

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