The United States economy managed to overcome one of its latest setbacks as the nonfarm payrolls in April released today managed to erase the disappointment from last month. The U.S. economy added 223,000 jobs in line with expectations. The unemployment rate remained at 5.4 percent, but there was a further downward revision on the horrendous March numbers to 85,000. The retail sales figures have not outperformed expectations and in some cases failed dramatically to meet them. American consumers have not spent their energy saving and have opted to save or repay debt, which has hurt the retail sector. Going forward as the price of oil rises there will be no savings to boost sales so the numbers released this month could be further extrapolated to set the U.S. retail picture in the second quarter of the year.
U.S. core retail sales are expected at 0.4% excluding auto. Including car sales the forecast is for 0.3%. Last month core retail came in at 0.4% (expected 0.7%) and retail sales was 0.9% (expected 1.1%). The lower forecasts are explained by the lack of consumer spending that is hurting the retail sector. Historically the retail sales data has a deep impact on the USD, specially when the indicator underperforms.
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