Connect with us


Forex Market Restrained as US Retail Sales Smash Predictions




Forex Market Restrained as US Retail Sales Smash Predictions
  • Stronger USD Holds Back Pound
  • Euro Also Restricted As Data Exceeds Expectations
  • Markets Look to Continue Winning Run

Both the Euro and Sterling remain under increased pressure today as the forex market weighs up a number of factors with US retail sales data coming in much stronger than expected today. This data show a positive return by consumers though the Dollar has been picking up strength as treasury yields increase and concerns about increased inflation come to the fore.

Pound Can’t Break Key Mark as USD Strengthens

The GBP has surged to post-Brexit high points in recent weeks. This is thanks in part to a well-managed COVID-19 vaccination rollout and a nation that seems to be getting a handle on new cases with a mandatory hotel lockdown now in place for many new arrivals. It has been held back from crossing a significant milestone so far today though. The Pound has retreated slightly with the $1.40 point in clear sight.

This is a psychological barrier perhaps for those forex trading the Pound but is also due to the fact the Greenback has been gaining strength on concerns that inflation could become a problem in the not too distant future. With a huge amount of fiscal money being pumped into the economy, and more to come by the end of the month, there are growing concerns that reflation will become an issue.

Euro Remains Weak on US Sales Figures

Improved US Dollar strength has brought further pressure on the Euro which still sits below the $1.21 mark. Even though German sentiment indicators and the general feeling in the region are slowly returning on the positive side, renewed strength from the Dollar which hasn’t been matched has kept the common currency under pressure.

Eyes from many in the bloc are on the release of retail sales data to see how the US economy is bouncing back as most analysts expect with positive figure predictions being easily beaten. This   could at least be a short-term bounce for the Euro while it continues to recover its own strength domestically. At the same time, the risk which is strengthening the Dollar at the moment is a concern of reflation. This has not been solved even with the above expectations data.

Wall Street Looks to Continue Strong Run

While the key driver for forex brokers and those trading today is undoubtedly the retail sales figures, Wall Street is also taking in the huge numbers beat just released. Despite the data showing that consumers spent big in January, the futures market is pointed downward.

US retail sales data came in at 5.3% and well ahead of the 1.2% analysts had expected, yet the market, which has been on a winning run. Such a strong beat on the number is certain to push forth the concern that inflation could be an issue with treasury yields and bonds both moving higher as many traders continue to wonder if the market still has room to run.


Spread the love

Anthony is a financial journalist and business advisor with several years’ experience writing for some of the most well-known sites in the Forex world. A keen trader turned industry writer, he is currently based in Shanghai with a finger on the pulse of Asia’s biggest markets.

Advertiser Disclosure: is committed to rigorous editorial standards to provide our readers with accurate reviews and ratings. We may receive compensation when you click on links to products we reviewed.

ESMA: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. Between 74-89% of retail investor accounts lose money when trading CFDs. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

Investment advice disclaimer: The information contained on this website is provided for educational purposes, and does not constitute investment advice.

Trading Risk Disclaimer: There is a very high degree of risk involved in trading securities. Trading in any type of financial product including forex, CFDs, stocks, and cryptocurrencies.

This risk is higher with Cryptocurrencies due to markets being decentralized and non-regulated. You should be aware that you may lose a significant portion of your portfolio. is not a registered broker, analyst, or investment advisor.