Yesterday was a poor day for the US dollar, which saw it weaken after recent strength. No data releases were the key to this, but with large currency orders being placed, this saw the US dollar suffer against sterling, trading at the 1.55 levels for the first time since the end of May.
The focus on this week has been on the US retail sales, which is due for release today. A large increase is expected, and the biggest retail sales figure since April last year, dwarfing the previous month’s. If the actual release pans out as expected, we should see US dollar strength in reaction, as spending grows in line with wage increases. This will back up recent statements from US Federal Reserve members regarding the recent slowdown which was blamed on seasonal factors.
Weekly unemployment claims are expected to be a stable following last week’s non-farm employment change, which showed a much better-than-expected figure.