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Will the Dollar Remain Firm Ahead of U.S. Retail Sales Data?

Market Report

Will the Dollar Remain Firm Ahead of U.S. Retail Sales Data?

Today's Highlights
  1. Preliminary UK GDP Figures for January–March
  2. U.S. April Retail Sales

In the U.S. currency market the previous day, the U.S. dollar held steady as the April Producer Price Index (PPI) came in at 1.4% month-over-month and 6.0% year-over-year—exceeding market expectations—amid waning expectations for a U.S. interest rate cut.The USD/JPY pair traded within a range of 157.54 to 157.93 before closing near 157.86, continuing to trade in the upper 157-yen range.Currently, the 158.00 level is likely to be viewed as resistance, while the focus will be on whether the 157.50 to 157.00 range will act as support. We will be watching today’s U.S. retail sales data to determine whether the U.S. dollar’s resilience will continue.

European currencies were weighed down by political uncertainty in the UK and a strong U.S. dollar, causing the pound to face resistance against the dollar. The GBP/USD pair traded within a range from the 1.3480s to the 1.3550s before closing around 1.3520.Sellers are likely to be on the lookout for pullback opportunities near 1.3550, so the immediate focus will be on whether the pair can hold support in the 1.3500 to 1.3480 range.Today, the UK is scheduled to release preliminary GDP figures for the January–March quarter, monthly GDP for March, industrial production, and the trade balance; we will be watching to see how the pound reacts to these economic indicators.

Today’s key economic indicators include the preliminary UK GDP figures for January–March at 15:00, March monthly GDP, March industrial production, March manufacturing output, and March trade balance; U.S. April retail sales and U.S. April retail sales (excluding autos) at 21:30;U.S. Initial Jobless Claims for the Previous Week, U.S. April Import Price Index, and Canadian March Wholesale Sales; and at 23:00, U.S. March Business Inventories.In particular, during European trading hours, UK GDP-related indicators are likely to be key drivers, while during New York trading hours, U.S. retail sales and employment-related indicators are likely to be key drivers; we will carefully monitor the reactions of the pound and the U.S. dollar.

桜井 慶介

Author: Keisuke Sakurai

He has over 10 years of experience in FX trading. In the financial sector, he has been involved in investment management focused primarily on foreign exchange markets and has experience as an asset management advisor. Drawing on his extensive experience, he specializes in technical and fundamental analysis.

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