US Retail & PPI figures weaker than expected

USDJPY, 60min   

US retail sales fell 0.3% in March with the ex-auto component up 0.2%. But the 0.1% dip in the February headline and ex-auto sales were each revised up to unchanged, which offsets some of the headline disappointment. Sales excluding autos, gas, and building materials was unchanged from a 0.4% gain previously (revised from 0.1%). Pacing the headline weakness was a 2.1% drop in car sales, with clothing off 0.9%, while eating and drinking establishments fell 0.8%. Building materials climbed 1.4%, with healthcare up 1.0%, along with a 0.9% rebound in gas station sales.

US March PPI dipped 0.1% with the core rate off 0.1% too, both underperforming expectations. There were no revisions to February with a 0.2% headline decline, and a flat core reading. On an annual basis, final demand PPI slowed to a -0.1% y/y clip versus unchanged previously, with the core rate dipping to 1.0% y/y from 1.2% y/y.

The USD fell broadly after the weaker than expected retail sales, and the cooler PPI outcomes. EURUSD rallied to 1.1325 from just above 1.1300 as USDJPY fell under 109.10 from near 109.35.  Next upward resistance on the 60 min chart is the 200 MA at 109.56, with support around 109.00 – 108.90.