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Weaker than expected consumer spending figures led to a dip for the Greenback but it was quick to get back on its feet and end the session mostly unchanged.

  • U.S. Feb headline retail sales down 0.1% vs. estimated 0.3% gain
  • U.S. Feb core retail sales posted 0.2% uptick vs. 0.4% consensus
  • U.S. Jan headline retail sales upgraded from -0.3% to -0.1%
  • U.S. Jan cor retail sales revised from 0.0% to 0.1%
  • U.S. Feb headline PPI up 0.2% vs. projected 0.1% uptick
  • U.S. Feb core PPI up 0.2% as expected
  • Kudlow takes former White House economic adviser Cohn’s spot
  • EIA crude oil inventories up by 5M barrels vs. 2.2M forecast
  • New Zealand GDP at 0.6% vs. 0.8% forecast in Q4 2017

Major Events/Reports:

Downbeat U.S. retail sales

The dollar took some hits early in the session when the February retail sales report churned out weaker than expected results. Headline consumer spending is down 0.1%, marking a back-to-back monthly drop, while the core figure posted a slower than expected 0.2% uptick.

The release wasn’t all that bad, though, as the January readings enjoyed positive revisions. The headline figure for that month was upgraded from a 0.3% drop to just a 0.1% dip while the core version is up 0.1% versus the initially reported flat figure.

Components of the latest report revealed that the drop was mostly caused by yet another monthly decline in purchases at auto dealers and gas stations. This was accompanied by weaker spending for furniture, home furnishing, electronics, and appliances. On a less downbeat note, spending in building material stores ticked higher.

PPI figures also turned out mostly upbeat, with the headline figure coming in at 0.2% and the core reading posting the expected 0.2% gain.

Stocks dip, commodities stay supported

Wall Street ended the day in the red as weaker consumer spending added to risk-off vibes stemming from trade war concerns. Surprisingly, crude oil managed to shrug off higher output readings and forecasts, likely due to stronger than expected data from China released earlier on.

  • Dow 30 index is down 248.91 points to 24,758.12 (-1.00%)
  • S&P 500 index is down 15.83 points to 2,749.48 (-0.57%)
  • Nasdaq is down 14.20 points to 7,496.81 (-0.91%)

The Energy Information Administration reported that stockpiles rose by 5 million barrels versus the estimated increase of 2.2 million barrels and the earlier rise of 2.4 million barrels.

To top it off, the OPEC projected that output from producers outside of the cartel would reach 1.66 million barrels per day this year, up from their earlier forecast of 1.40 million barrels per day. Then again, the group also predicted that demand would be slightly higher at 1.60 million barrels per day.

  • Gold is flat at $1,325.00 per troy ounce
  • WTI crude oil is up to $60.89 per barrel (+0.15%)
  • Brent crude oil is up to $64.94 per barrel (+0.19%)

Major Market Mover(s):

USD

The scrilla got knocked down but got up again, even as weak retail sales data hinted of a lower contribution from spending to GDP growth this quarter.

USD/JPY dipped to a low of 106.06 then rebounded to 106.39, EUR/USD hit a high of 1.2398 then resumed its drop to a low of 1.2348, GBP/USD is still hovering just below 1.4000, and USD/CHF reached a high of .9481 before retreating to .9445.

JPY

The lower-yielding yen was able to take advantage of the dip in the dollar, as well as the return of risk-off vibes.

EUR/JPY slid to a low of 131.09, GBP/JPY tumbled below the 148.00 handle, AUD/JPY fell back to a low of 83.38, CAD/JPY is down to 81.72, and NZD/JPY slipped to 77.49.

Watch Out For:

  • 12:00 am GMT: Australia MI inflation expectations (3.6% previous)