The report detailing the Advance Retail Sales in the US are expected to be released on Wednesday 20 November 2013. The report will relate to the sales performed during the month of October 2013. At this time, many experts believe that the figures may show a slight increase from the previous month of September.
Analysts believe that the recent report on jobs that was issued earlier this month showing a rise in the number of people added to the workforce could be an indicator that the level of sales could rise in this month’s report. As more people are hired into the economy, and they feel more secure in their employment status, consumer spending has been known to go up.
Analysts remind readers that this report is an important indicator of consumer demand, a crucial driver of the US economy which accounts for nearly two thirds of economic activity. Moreover, it can be taken as a test of consumer confidence, representing part of the potential spending power of the US consumer. Experts are also partial to this report due to its fast turn around, giving them much needed data before the release of the official GDP figures.
Traders are advised that positive movement in the Advance Retail Sales could affect the dollar, helping to bolster it in trading against rival currencies.
American CPI Reports to be Issued Tomorrow
The Consumer Price Index reports for the United States are set to be issued tomorrow 20 November 2013. The reports will document changes to the cost of living for consumers in the US during the month of October 2013. Analysts note that there will be two reports issued concerning the American CPI, the general report and the CPI excluding food and fuel.
At this time, many experts expect that the more inclusive general CPI report will likely drop down, indicating a lower cost of living for consumers. At the same time, the report that excludes the factors of food and fuel is not expected to fall, remaining constant.
Analysts note that these CPI reports are useful indicators for understanding the status of the economy, providing experts with an additional snapshot of how prices are affecting consumers. As noted in the report above, consumer spending is a crucial driving force in the American economy and as such, it is closely monitored.
It is also important to note that the CPI excluding food and fuel can provide a more stable picture for economists since the prices of these two factors can often shift significantly over short periods of time. This can be seen in the West Texas Intermediate crude market which has fallen off significantly in the last two weeks. Additionally, due to the short term pressures on food sources such as seasonality, weather, and other factors, food prices are constantly shifting, making their impact on the CPI unpredictable at times.
Analysts advise traders to watch for slight fluctuations in the value of the USD that may be brought on by release of this report.
FOMC Minutes to be Released on Wednesday
Economists and other observers are anxiously awaiting the 20 November 2013 release of the minutes from the US Federal Reserve’s Federal Open Market Committee’s most recent meeting which took place on 29 and 30 October 2013.
Analysts note that the importance of the minutes from the FOMC’s two day meetings is that it provides important insights into the decision making process of the monetary policy body which have a significant impact on the value of the USD. Especially now with the ongoing debate regarding speculations on what sort of timetable the Fed may be contemplating for implementing cuts to their $85 billion stimulus program. This debate over whether or not to step down on the quantitative easing is of particular interest to many investors as the cuts would likely push up the value of the dollar in trading.
As has been noted in past reports, the FOMC is looking for certain key metrics to be met before they will move to make any changes to the stimulus. Among those factors are the employment situation and other economic health report cards that indicate that the economy will be able to stand on its own without the added support from the Fed.
Analysts do not believe that the American economy has reached a point where the Fed will issue any serious remarks that would move towards cuts to the stimulus. In particular, with the nomination of Janet Yellen, who has expressed her support for a continuation of the quantitative easing into the near future, based on her concern that the economy is still acting below its potential, then it is unlikely that the FOMC will wish to make any significant changes in direction at this time.
That said, the release of these minutes could still have an effect on the trading of the USD as investors react to speculation over how the FOMC will come down on the issue of the stimulus. Traders are advised to look for potential volatility following the release of this report.