Alpesh Patel
InvestingBetter.com
On Friday investors’ focus had been on the US Retail Sales report and secretly most of them hoped for a surprise that would help the US currency to recover against its rivals. However we had warned our audience that the bias was bearish and the most likely outcome for the consumer spending report would be a lower reading confirming the slowdown in the sector.
Indeed the Retail Sales figures came out exactly as expected with the report showing a lower reading for consumer spending during the last month. The stagnating wages in the US was one reason behind the bearish printing of the report but at the same time the volatile conditions on a global scale might have played their parts on keeping consumers cautious.
The result of the report was a decline for the US Dollar against most of its peers, apart for the British Pound that continued its bearish course. The question that this fresh report poses though is whether this would affect Fed’s plans for further rate hikes with the first quarter or half of the year. The recent string of data coming out of the US hasn’t been too exciting and that might force the US policymakers to take it easier with normalizing policy in the next months.
During the Asian session though the US Dollar has been recovering against its rivals with the Euro dropping below the 1.0900 a few hours ago after the 1.0980 highs on Friday and the Cable is trade just shy of its fresh lows around the 1.4260 area. There is a total lack of any important report pending for release today and with the US markets on holiday we should expect limited volatility and price action at the beginning of the week.
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