US retail sales miss on all fronts – USD plunges

US retail sales  rose only 0.1% m/m on top of a downwards revision from +0.2% to 0%. Core sales  dropped 0.3% with a downwards revision from 0.1% to -0.1%. The control group fell 0.1% instead of rising and also here, a downwards revision  from +0.4% to +0.2%.  PPI also missed.

The US dollar is suffering with ranges extended everywhere. — more coming

Retail sales and PPI data

• Retail sales up +0.1% instead  of +0.2% expected with a downwards revision  of -0.2% in total.
• Core sales down -0.3% instead of -0.1% with a  revision of -0.2%.
• Control group down 0.1% instead of +0.3% with a revision of -0.2%.
• PPI m/m down 0.5% instead of -0.2%
• PPI y/y down 1.1% instead of -0.7%.
• Core PPI m/m down 0.3% instead of +0.1%
• Core PPI y/y up 0.8% instead of 1.2%.

This is just a miss after miss after miss.

Retail sales were expected to rise by 0.2% in September after a rise of the same scale in August (before revisions). Core retail sales carried expectations for -0.1% after +0.1%. The retail control group was expected to advance +0.3% after +0.4% and ex-autos rose +0.3% last time. PPI was expected to  drop -0.2% m/m and 0.7% y/y. Core PPI was expected to  rise +0.1% m/m and 1.2% y/y.

The US dollar was on the back foot across the board, with  more limited losses against the euro and the Aussie.

There are lots of measures and exclusions as well as revisions,  and the numbers sometimes go in both directions.  Nevertheless, retail sales are critical to the US economy and this is one of the figures the Fed is certainly looking at.

Currencies

• EUR/USD traded at 1.1410 before the release after  euro-zone data came out as expected.  The pair reached a new high of 1.1440, still under resistance at 1.1460.
• GBP/USD traded at a high of 1.5380, ignoring  a miss on wage growth. Cable now tops 1.54 at 1.5412.
• USD/JPY was down at 119.60. and slides to 119.40.
• USD/CAD traded just under 1.30 awaiting developments in oil prices. and is now at 1.2970.
• AUD/USD was the weaker link, suffering from Chinese data and trading at 0.7250 and it now tackles important resistance at 0.7280.
• NZD/USD was on high ground of 0.6730 and is at a new 3 month high of 0.6750.

More:  ECB keeps EUR/USD from topping 1.20 – Morgan Stanley