FOREXYARD: Forex News Blog

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Be Prepared! U.S. Retail Sales Tomorrow at 12:30 GMT Posted: 13 May 2010 09:59 AM PDT We at ForexYard, encourage our customers to get involved in the most intense market events. As such, we think you should know that the U.S. Retail Sales report is expected tomorrow, May 14th, at 12:30 (GMT), and you need to be prepared. Market events like this one tend to create either big changes to current trends or push current trends even further. Generally, the Majors are the ones most affected by market events in general, but Crude Oil, Gold prices, and even the price of Silver can change dramatically in the seconds after such a publication. For more information about the U.S. Retail Sales, please read below. What is the U.S. Retail Sales Report? U.S. Retail Sales is a leading economic indicator used to measure the percentage change in the total value of sales at the retail level during the previous month. It is a leading indicator of economic health because the report reflects a wide variety of consumer spending, such as restaurants, consumer goods, and automobiles. Consumer sentiment can also be derived from this survey in order to gauge the outlook on the U.S. economy. This report is the earliest indicator of consumer spending released by the U.S. Census Bureau. An additional report released at the same time is the Core Retail Sales report, which does not include sales of automobiles. When used together, the reports paint a picture of the state of the U.S. consumer. This survey predominantly helps to analyze market trends and to determine the direction of the U.S. economy. If the Survey Comes Inline with Market Forecasts Expectations for this month are suggesting that the U.S. Retail Sales will rise by 0.3% in April, for a seventh straight month, pointing to a rebound in consumer spending that is broadening the recovery. The U.S. economy is currently in the midst of a solidifying economic recovery and April's Non Farm Payroll data which showed a long awaited increase in employment is likely boosting demand. Electronics stores may have led retailers last month as Apple Inc. sold at least 1 million iPads. A result inline with expectations will likely boost the Dollar further as it will intensify investors' belief that the world's largest economy is on a strong path to recovery. This will likely push the EUR/USD pair to further lows, possibly dropping another 50 – 70 pips. If the Survey Will Surprise With Bearishness If the actual figure is lower than forecasted, traders are likely to see the USD depreciate against its currency pairs and crosses. The volatile two trading weeks we have just experienced concluded with significant strength for the USD. The increase in April sales may have been less broad-based than in prior months. Chain stores reported the smallest increase in monthly sales since November. Furthermore, the debt crisis in Europe also raises the risk households will restrain spending. In this turn of events, the EUR/USD might correct itself up slightly, possibly gaining around 50 pips.

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