Retail sales: From theory to practice

Dr. Nektarios Michail HFM

Last time I talked about Retail Sales, the main idea was that worse-than-expected Retail Sales releases are bad because they imply less consumption spending. This would be bad both for the stock market, given that less spending means less profits, and the currency market given that it would suggest that the economy is growing more slowly than expected. The latest US Retail Sales release showed that the numbers for September were much worse than anticipated (see below). How did the market react?

To begin with, the stock market (Chart above) dropped by 2 points in the half hour after the announcement. Similar to this, the USD (Chart below) dropped 17 pips upon the announcement. This expected negative reaction to the results highlights the importance of this indicator as regards to the overall state of the economy and also comes in a climate of overall uncertainty regarding the developments in US foreign policy.

Author

Dr. Nektarios Michail

HFM

With more than 4 years of experience at the Central Bank of Cyprus where he obtained hands-on experience with real-life economics, Dr Nektarios Michail is a supporter of a balanced approach between science and art when it comes to

EUR/USD climbs to two-week highs beyond 1.1900

EUR/USD is keeping its foot on the gas at the start of the week, reclaiming the 1.1900 barrier and above on Monday. The US Dollar remains on the back foot, with traders reluctant to step in ahead of Wednesday’s key January jobs report, allowing the pair to extend its upward grind for now.

GBP/USD hits three-day peaks, targets 1.3700

GBP/USD is clocking decent gains at the start of the week, advancing to three-day highs near 1.3670 and building on Friday’s solid performance. The better tone in the British Pound comes on the back of the intense sekk-off in the Greenback and despite re-emerging signs of a fresh government crisis in the UK.

Gold treads water around $5,000

Gold is trading in an inconclusive fashion around the key $5,000 mark on Monday week. Support is coming from fresh signs of further buying from the PBoC, while expectations that the Fed could turn more dovish, alongside concerns over its independence, keep the demand for the precious metal running.

Crypto Today: Bitcoin steadies around $70,000, Ethereum and XRP remain under pressure

Bitcoin hovers around $70,000, up near 15% from last week's low of $60,000 despite low retail demand. Ethereum delicately holds $2,000 support as weak technicals weigh amid declining futures Open Interest. XRP seeks support above $1.40 after facing rejection at $1.54 during the previous week's sharp rebound.

Japanese PM Takaichi nabs unprecedented victory – US data eyed this week

I do not think I would be exaggerating to say that Japanese Prime Minister Sanae Takaichi’s snap general election gamble paid off over the weekend – and then some. This secured the Liberal Democratic Party (LDP) an unprecedented mandate just three months into her tenure.

Ripple exposed to volatility amid low retail interest, modest fund inflows

Ripple (XRP) is extending its intraday decline to around $1.40 at the time of writing on Monday amid growing pressure from the retail market and risk-off sentiment that continues to keep investors on the sidelines.