US Retail Sales Expected to Thaw After Warmer Weather

The U.S. retail sales data remains a thorn in America’s side with respect to declaring a return to full economic growth.

With an impressive job recovery underway, and the lower price of oil putting more bucks into U.S. consumers’ pockets, it has been an unexpected, if not disappointing, surprise that they are not spending. Oddly, American consumer confidence remains high.

Last month, the -0.1% figure of the core retail sales and the -0.6% raised eyebrows and questions about how even the recovery has been. The lower purchases in March marked the third consecutive decline. Cold weather is partly to blame for lack of shopping, but that should no longer factor into the equation now that spring has sprung stateside. There’s much hope the warmer weather thawed frozen American consumers enough to have a positive influence on the data, due to be released on April 14 at 8:30 a.m. EDT. Analysts have forecast an improvement of 0.7% on the core reading (excluding auto), and 1.1% for the headline retail sales figure itself.

The EUR/USD has depreciated as rate divergence drives the EUR lower versus the USD. The effects of the disappointing nonfarm payrolls data released on Good Friday started being discounted as the USD was boosted by Fed members’ comments about the possibility of a benchmark interest rate hike in June.

Meanwhile, elections in the United Kingdom, and the ongoing saga that is Greece’s debt repayment mess, will continue to affect prices.

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza