Yesterday`s trades were marked with a series of worse than expected economic reports. The U.S Retails Sales indicator dropped by 0.1% in July breaking all economists` expectations. The index was expected to rise by 1.8%. The U.S Core Retails Sales index also performed an unexpected drop of 0.6%. The negative data proved o show that Americans are not likely to expend their spending.
Retail sales shows the level of consumer spending so it is treated as a consumer demand and consumer confidence indicator, it may serve as a reference point for the currency market during reversal points of the economic cycle. This index is highly important for following the USA economy, as consumer demand is its main driving force. As a result the US currency reacted immediately. The Dollar dropped against all the Forex currencies. The greenback lose 100 pips at against the EUR on Thursday. The bearish trend against JPY continued.