Dollar Edges Higher After US Retail Sales: Debt Ceiling in Focus

Dollar Edges Higher After US Retail Sales; Debt Ceiling in Focus: After statistics revealed that retail sales in April were worse than anticipated but that the underlying trend remained solid, the U.S. dollar edged higher on Tuesday. The dollar index was last little higher than usual for the day at 102.43. The dollar was little stronger against the yen at 136.155 yen. Although the underlying trend remained positive and U.S. retail sales increased less than anticipated in April, it is probable that consumer spending remained high early in the second quarter.

After statistics revealed that retail sales in April were worse than anticipated but that the underlying trend remained solid, the U.S. dollar edged higher on Tuesday. The dollar index was last little higher than usual for the day at 102.43. The dollar was little stronger against the yen at 136.155 yen. Although the underlying trend remained positive and U.S. retail sales increased less than anticipated in April, it is probable that consumer spending remained high early in the second quarter.

Potential News:

Today may bring some potential news on the debt ceiling. The likelihood is that this will be delayed until the deadline, which is early next month, Serebriakov added. “Therefore, the market ought to stay in a range. There doesn’t seem to be much of a direction impulse here.

Sterling also weakened to 87.17 cents per euro and fell as high as 0.5% versus the dollar in other trading sessions after Britain’s unemployment rate unexpectedly increased to 3.9% in the three months to March as more people looked to re-enter the labor force. Later, it bounced back, and as of latest trade, it was down 0.21% at 1.2501. The Bank of England is expected to raise rates at least one more time, by 25 basis points, and there is a substantial possibility that rates will rise again. However, given these findings, the BOE could exercise greater caution.

The data “reaffirms our view that the BoE will then be done with hiking,” according to analysts at Morgan Stanley. “We think the BoE will hike once more in June, as we see a further tick up in regular pay growth next month,” they said.

The information “bolsters the case for a June hold,” they continued. The euro was trading at $1.0867, down 0.06%, largely ignoring a sharp decline in market confidence in Germany and confirmation from the EU statistics office that the euro zone’s first quarter growth was 0.1% quarter over quarter.