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US Retail Sales Come in Strong | Euro Mixed Post-ECB, US Data

Published January 16, 2020
  • Accounts of last month’s European Central Bank meeting were released this morning and indicated that policymakers took a more optimistic view on the economy.  Minutes of the meeting showed policymakers see “mild indications” of rising inflation, and that economic growth may be stabilizing (albeit still weak).  Easing US-China trade tensions should help Europe’s struggling manufacturing sector, although there are concerns that the US may point their trade crosshairs at Europe next.  While the euro got an initial boost from the ECB accounts, the gains have since been erased after this morning’s US data releases.
  • Core retail sales and jobless claims both beat market expectations, giving the US dollar a bit of a boost.  The primary drivers of the monthly retail sales were from spending on food and beverage, health and personal, and gas stations, which could be slightly tilted as a result of favourable Christmas spending and inflationary factors at play.  Even if the headline numbers are skewed, it’s clear that the consumer is still what’s propelling the US economy forward even in times of uncertainty.  Markets won’t have to wait long to get another look at consumer data, as the Michigan Consumer Sentiment Index is set for release tomorrow morning.

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