EUR/USD, USD/JPY, DXY flows - retail miss adds to dollar trimming
Fairly hefty downside miss on retail sales headlines adds another straw this week
May tip $ into more of a pullback having stuck in their long
Hefty downside misses on the US retail sales data with the control coming in at -0.4%m/m vs mkt 0.3% - the prior month revised up by 0.1pp but not really softening the blow. Data echoes some weakness seen in credit card data so maybe there is some constraints coming in there or at least some current hanging back amid the uncertainty and higher costs.
Consumer had been hanging in their for quite a while, running on low confidence and recent real income squeeze so this might get quite a bit of attention. On top of the payrolls and inflation data, maybe the ‘straw on the camel's back’ to add a little extra weight to the dollar pullback. US2s chipping away on a retracement back towards the 4%~ threshold. Best not to overplay one data print, or one soft month overall in fact, but definitely plays positionally to some corrective lean, especially with the market having been quite sticky with its long dollar positioning.