Key Metrics Signal Aggregate US Retail Sales Increase, US Dollar Holds Firm.
The US Retail sales is an economic indicator in USA that keeps inventory of demand for finished goods, by measuring the purchases of durable and non-durable goods over a defined period of time. It is the primary gauge of consumer spending, which accounts for the majority of the overall economic activities.
In august 2021, the US Retail Sales declined -1.1% month-over-month from the previous 0.7% percentage base, as spending shifts to the service sectors following economic reopening and traveling picks up. It has maintained a diminishing growth pattern after a huge Retail Sales released figure in April with 9.8% increase.
Substantially, the positive outcome of the U.S. retailers to a wider scale can be seen through their performance in online retail. A prime example of this is Amazon and Walmart, with its sales revenue flourishing over the previous years in spite of the impact of the pandemic on the retail landscape and change in consumers behaviors.
Furthermore, the growth curve was sustained with increase demand for goods holding strong and spending shifting back to the service sectors. Though the automobile sector is facing declining purchase due to lack of supply caused by semiconductor shortage and boosting demand for used cars and trucks. Other labour market sectors such as Hotel accommodation, Restaurant, Agriculture, Transportation, Education etc are also powering the retail sales backed by the technology retails.
Accordingly, total retail sales in the United States are projected to hit 5.94 trillion US Dollars in 2024, up from the 5.47 trillion record low in 2019.
To a great extent, the report is expected to keep higher as acceleration in economic activities pick up steam and inflation steers. This is evident in other data showing strong growth in manufacturing and prices at factories. Currently, the Purchasing Manager’s Index((PMI) shows an industry expansion of 59.5, supported by a sharp increase in output and new orders. Also, employment is growing at the steepest rate and average hourly earnings grew by 0.6% as business confidence improves.
Regardless, traders should brace themselves up for a period of high volatility as the Retail Sales report often have great impact on the forex market.
Increase in retail sales will result in US dollar index strength
Decrease in Retail sales will result in US dollar index decline.
Traders should always be aware that volatile markets provide great opportunities for making profits, as the increase in volatility can cause market swings for traders to capitalize on.
The currency pairs with the US dollar, US Futures, US indexes, US Commodities and Shares are mostly affected by the data release and can be traded on ACT Brokers platform (actmarkets.com). They include; EURUSD, GBPUSD, XAUUSD, USDJPY, USDCAD, USDCHF, AUDUSD, NZDUSD, US100, FTSE, US Oil, Facebook, Amazon, Tesla etc.
Time Schedule for next Retail Sales release:
Date: Thursday, 16th September, 2021.
Time: 1:30 pm (GMT + 1)
Author: Amogo Solomon
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