US Facing Significant Downside Risks Economic Outlook

Newsletter

Zero spam.

US Facing Significant Downside Risks Economic Outlook

(US) MAY ADVANCE RETAIL SALES: -0.2% V -0.2%E

  • RETAIL SALES LESS AUTOS: -0.4% V 0.0%E (largest ex-autos decline since May 2010)
  • Sales Ex Auto & Gas: -0.1% v 0.4%e
  • Prior Advanced Retail Sales revised lower from +0.1% to-0.2 %
  • Prior Less Autos revised lower from +0.1% to -0.3%
  • Prior Ex Auto & Gas revised lower from +0.1% to -0.1%

(US) MAY PRODUCER PRICE INDEX M/M: -1.0% V -0.6%E

3rd Party Advertisement
  • (US) PPI EX-FOOD&ENERGY M/M: 0.2% V 0.2%E (weakest Y/Y PPI since March 2009)
  • PPI Y/Y: 0.7% v 1.2%e – PPI Ex Food & Energy Y/Y: 2.7% v 2.8%e

This is from the press release by the U.S. Department Of Commerce:

English: Seal of the United States Census Bure...

The U.S. Census Bureau announced today that advance estimates of U.S. retail and food services sales for May, adjusted for seasonal variation and holiday and trading-day differences, but not for price changes, were $404.6 billion, a decrease of 0.2 percent (±0.5%)* from the previous month, but 5.3 percent (±0.7%) above May 2011. Total sales for the March through May 2012 period were up 5.7 percent (±0.5%) from the same period a year ago. The March to April 2012 percent change was revised from 0.1 percent (±0.5)* to -0.2 percent (±0.2%)*.

Retail trade sales were down 0.2 percent (±0.5%)* from April 2012, but 5.0 percent (±0.7%) above last year. Nonstore retailers sales were up 12.4 percent (±3.1%) from May 2011 and motor vehicles and parts dealers were up 10.0 percent (±2.1%) from last year. The advance estimates are based on a subsample of the Census Bureau’s full retail and food services sample.

How to interpret this data?

US Facing Significant Downside Risks Economic Outlook following the worst NFP release of the year, it is no surprise today to see a much softer Retail Sales figure today at a contraction of 0.2%.  This is likely to add more pressure on the Federal Reserve (Ben Bernanke) to launch another round of quantitative easing, or at least, some sort of measures to stimulate the economy as soon as ‘Operation Twist‘ ends.  Although Bernanke is reluctant to talk about further QE, recent data and comments from other Fed officials are suggesting that the Fed will do something soon.

We are likely to see USD weakness on the basis of potential QE speculation on the rise, of course with the market focus on the upcoming Greek election, USD could be back in demand for safe-haven flows… but assuming that Greece were to stay in the EU after next week, then USD could be facing strong selling pressure in the weeks to come.  Of course, the PPI release indicates that there are plenty of room for the Fed to launch another QE seeing that the year to year number just rose 0.2%.

FUNDAMENTALS
Forex Weekly Outlook May 22 ~ 26, 2017
Forex Weekly Outlook – May 15 ~ 19, 2017
Daily Newsletter Is Back!
Key Facts For The Upcoming FOMC Meeting
Interest rates too low for too long could cause financial instability: Fed’s Bullard
About Henry Liu

My name is Henry Liu and I am a Forex Trader and Mentor. I help traders achieve consistent income trading Forex while spending less time trading. My focus in trading is a combination of Fundamental Analysis, Technical Analysis, and Market Sentiment. Far too many retail Forex traders concentrate on just one aspect of trading, technical analysis, and ignore everything else; it is my goal (and vision) to educate every trader on how to take advantage of news trading and become more balanced traders.

You can find more information about me on my Google Profile.

Speak Your Mind

*

Newsletter

Zero spam.