After the dollar rally seen late last week, it seemed that markets were ready for some consolidation and correction.
However, the better than expected retail sales figure in the US provides some support to the US dollar and curbs some of the correction. When the wave of dollar buying renews, the retail sales numbers will provide a justification for the new rise. At the moment the dollar remains more or less balanced with other currencies.
The headline figure surprising by edging up 0.1%, instead of dropping by 0.3%. This isn’t a very big surprise, and it came on top of a marginal downwards revision of last month’s result: a drop of 0.5% instead of 0.4% originally reported.
Core sales dropped by 0.1%, exactly as expected. All in all, this is result is better than expected.
These important numbers join the better-than-expected jobless claims number on Thursday and the good Non-Farm Payrolls report for April released early in the month.
EUR/USD was especially hit by the fresh talk about negative rates earlier in the day.
