Article Highlights

  • U.S. May headline retail sales up 0.5% vs. 0.4% forecast
  • U.S. May core retail sales up 0.4% as expected
  • U.S. import prices rose 1.4% vs. 0.8% consensus
  • U.S. business inventories up 0.1% vs. 0.2% forecast
  • TNS Brexit poll: 47% leave, 40% stay
  • NZ current account balance showed 1.31B NZD surplus, 0.97B NZD expected
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The Greenback had a positive reaction to the upbeat U.S. retail sales report but was mostly stuck in consolidation for the rest of the trading session.

Major Events:

U.S. retail sales report – Headline U.S. retail sales beat expectations of a 0.4% gain and showed a 0.5% increase for the month of May while the core version of the report printed a 0.4% rise as expected. Components of the report showed that most of the gains were driven by online retailers, followed by purchases of clothing and sporting goods.

This follows the 1.3% jump in consumer spending recorded in April, indicating that domestic demand has slowed but has managed to stay afloat. For most analysts, the recent report suggests that the consumer sector could continue to prop up U.S. growth figures, provided that hiring and wages remain stable.

More Brexit chatter – Traders continued to keep close tabs on Brexit-related updates, with the latest TNS poll indicating a lead in favor of those voting to leave the EU. U.K. government officials seem to be stepping up their game when it comes to discouraging voters from choosing a Brexit, as U.K. Chancellor Osborne mentioned that they would have to raise taxes to offset a potential hit to public finances in that scenario.

Major Currency Movers:

GBP – The British pound once again lagged behind its peers as Brexit fears weighed on the currency.

GBP/USD pulled up close to 1.4200 before resuming its drop to 1.4115, GBP/JPY struggled to hold on to the 150.00 handle, EUR/GBP edged from a low of .7910 to a high of .7953, GBP/AUD is down to 1.9240, and GBP/NZD is down to 1.3600.

Watch Out For:

  • 12:30 am GMT: Australia Westpac consumer sentiment

See also:

Asian Session Recap

London Session Recap

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