Baxia Markets
May 14, 2021

USD - Core Retail Sales / Retail Sales m/m

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What is it? 



Core Retail Sales / Retail Sales are both very important indicators when it comes to gauging an economy's health. The math behind the statistic in simple terms is the change in the total value of sales at the retail level. Core Retail Sales excluding automobiles. To keep things simple again, the US government tracks everything that is sold at the retail level and adds it up each month, and then compares it to the month before. 



What are the Expectations for the USD - Core Retail Sales / Retail Sales m/m?



With this release right around the corner, we take a look at what the expectations are for this release and what it means. The expected figure for Core Retail Sales is 0.5%. The expected figure for Retail Sales is 1% This means that sales at the retail level have increased 0.5% and 1% respectively for Core Retail Sales and Retail Sales over the last month. 



Professional Insight



“The Fed will let inflation run hot into 2023. I would be so shocked if the Fed hiked interest rates in 2022,” said Greg Anderson, global head of foreign exchange strategy at BMO Capital Markets.


Does this mean people will continue to spend? Or will it mean, people stop spending and start saving? Today’s release will be a good indicator of this. 



What happens if...



If the actual percentage increase is higher than the previous month and more importantly higher than the expectation, then that is a good sign of a healthy economy that is spending money. When you have a healthy economy with high spending, that is generally a sign that your currency will appreciate. 



What happens if…



If the release comes less than expected or lower than the previous month's figure, you are looking at spending contraction. Meaning people are spending less money for some reason. This shows some weakness in the economy and could lead the currency to depreciate. 



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