Rate cut expectations dragged the dollar lower across the board last week. Will we see the same themes this week? Here’s a list of its potential catalysts!
CPI (June 12, 1:30 pm GMT)
Consumer prices heated up by 0.3% in April, which is cooler than the 0.4% gain seen in March and what analysts had expected.
The dollar fell across the board at the release, though the strong move might have also been from the U.S. raising tariffs on $200 billion worth of Chinese goods from 10% to 25% as the Trump admin had scheduled.
One look at the forex calendar tells me that traders are only expecting a 0.1% consumer price increase this time around.
The core figure, which excludes volatile items such as food and energy prices, is expected to gain 0.2% after rising by 0.1% in April.
Recall that the Fed is under pressure to ease its monetary policies. See, factors like the U.S.’ rocky relationship with its closest trading counterparts and weak economic data point to a weaker economy unless Powell and his friends step in.
Though the Fed has a more preferred gauge of consumer prices, strong hits or miss in this week’s CPI numbers could strengthen or abate calls for easier policies from the Fed. Make sure you’re glued to the tube during the release!
Retail sales (June 14, 1:30 pm GMT)
Looks like it’s all about consumers this week, huh?
In last month’s release we found out that retail sales had slipped by 0.2% in April. That’s lower than the 1.7% increase seen in March and the 0.2% uptick that many had expected.
Meanwhile, core retail sales inched 0.1% higher after clocking in a 1.3% growth in March.
A closer look told us that it was motor vehicle sales, clothes, appliances, and building materials that mostly dragged retail numbers lower.
This week analysts expect to see a 0.7% rebound in headline retail spending and a 0.5% jump in the core figure.
Upside surprises could provide last-minute boosts for the Greenback while huge misses could extend its downtrend from the previous week.
Missed last week’s price action? Read USD’s price recap for June 3 – 7!