North American Summary and Highlights 19 Jan

North American session
There was little FX movement of any note in the Friday North American session. The USD did start the session strong, gaining some ground across the board and particularly against the JPY with USD/JPY reaching a high of 148.54, but as equities built gains the USD ended the session slightly weaker. EUR/USD gains stalled ahead of 1.09 while GBP/USD advanced to near 1.27.  USD/JPY found support at 148 while USD/CAD fell from near 1.35 to below 1.3440,
University of Michigan confidence data was clearly on the strong side of expectations, but USD gains mostly preceded the data, and subsided after it. January’s gain to 78.8 from 69.7 was the second straight strong rise and the highest since July 2021. Inflation expectations edged slightly lower. December existing home sales however remained weak, -1.0% to 3.78m. The only other news of note was a 0.2% decline in November Canadian retail sales, but this had little impact. 
European morning session
The USD fell against the AUD and JPY but gained a little ground against GBP and was unchanged against the EUR in the European morning. USD/JPY fall back from around 148.50 at the open to below 148, while AUD/USD tested above 0.66 after opening at 0.6575. EUR/USD was not much changed close to 1.0880, while GBP/USD was a little weaker, falling 20 pips to 1.2680 after the weak UK December retail sales data.
The UK retail sales data showed a 3.3% decline in sales volumes in December, the largest decline since 2008 excluding the pandemic. This is possibly partly due to sales having been brought forward but still shows broad weakness and points to similar drop in Q4 consumer spending as seen in Q3, with ensuing downside GDP risk.  Most startling is the level of real sales is weaker than prior to the pandemic, albeit not a marked as clear slump during COVID.
Otherwise the only significant data was German December PPI, which came in weaker than expected at -1.2% m/m, -8.6% y/y.