US retail sales flat in July, miss expectations
US retail sales were unexpectedly flat in July, according to data from the Commerce Department.
Sales were unchanged from the previous month, down from a 0.8% increase in June and missing expectations for a 0.4% gain.
Core retail sales – which exclude auto sales – declined 0.3% following a 0.9% increase in June, marking the worst reading since January and falling short of expectations for a 0.2% advance.
Peter Read, co-founder of app-only trading network Pelican, said: “Fed Chair Janet Yellen will be disappointed to not be able to add today’s retail sales data to the body of evidence she is building that supports raising interest rates later in the year.
“The possible intervention on rates received a notable backer in San Francisco Fed chief John Williams this week, which comes off the back of a second successive better than expected non-farm payroll result last week.”
FXTM research analyst Lukman Otunuga said: “This is an unexpected miss and what onlookers are likely wondering is why despite such significant improvements being made in the US jobs market that there is still a substantial delay when it comes to noticing a consistent correlation with improved consumer spending?
“Retail sales stalling despite further improvements being recorded in the US jobs market is going to lead to some anxieties over possible slowing domestic growth in the US. As such, expectations for a US interest rate increase by the Federal Reserve in 2016 is likely to take another hit and this will also contribute to a drop in demand for the Dollar as trading for the week concludes.”