US Core Retail Sales Update Coming Soon

U.S. Core Retail Sales Update Coming Soon

The Census Bureau will publish the Core Retail Sales m/m today at 13:30 GMT. It is expected to increase to 0.4%, a pickup from the previous update, which showed an increase of 0.1%. This measure is based on retail sales across the U.S. but excludes auto sales since these have proved naturally volatile in many cases. The data is derived from statistics collected by about 5,000 retail outlets of various sizes and types; the coverage is comprehensive consumer buying habits.

Market participants will most likely scour this data for any sign of potential inflationary trends. If the figure reported is at or above the forecast, it may be indicative of stronger consumer demand, which could support the Federal Reserve's view of a strong economy. This might precipitate an increase in the U.S. dollar as investors see a better economic picture.

On the other hand, if the data misses the expectations, it would probably signal weaker consumer spending and further concerns about slower economic growth. In that scenario, the dollar may come under downward pressure as the markets adjust their expectations for monetary policy.

While the data is of great value in providing insight, other economic factors will most likely impact the broader market response, leaving the real effect uncertain.

Canada CPI Forecast About the Potential Effects on the Canadian Dollar

The Consumer Price Index (CPI) m/m will be reported by Statistics Canada today at 13:30 GMT. The forecast shows it rising by a low amount: 0.1%, from 0.4% seen in the previous period. It calculates the month-to-month percentage increase in the cost of living for consumers through prices for a basket of a fixed set of goods and services.

This would be the case if the actual CPI meets or exceeds forecasted values, which could signal that inflationary pressures are still part of the Canadian economy. It might strengthen the CAD, as markets could interpret this as a sign of the economy's resilience or as a potential trigger for tighter monetary policy.

A lower reading of the CPI indicates a weak situation of the inflationary pressures. A consequence might be to speculate upon the slowdown of economic activities, and downward pressure would be confronted by the CAD against the major currencies.