When are US monthly retail sales figures and how could they affect EURUSD?

US Monthly Retail Sales Overview

Wednesday's US economic docket highlights the release of monthly Retail Sales figures for October, due later during the early North American session at 13:30 GMT. Following a flat reading in September, the headline sales are estimated to have grown by 1% during the reported month. Excluding autos, core retail sales probably climbed by 0.4% in October as compared to a modest 0.% rise in the previous month.

Analysts at Commerzbank sound more optimistic about the key macro data and explain: “We expect Retail Sales to rise by 1.2% from September, which would also signal a significant gain in real terms. This should make it clear that the US economy is still not in recession. We do not expect this to happen until the beginning of 2023 anyway, with consumer spending, which accounts for a good two-thirds of GDP, holding up better than we expected until recently.”

How Could it Affect EUR/USD?

Ahead of the release, a goodish recovery in the global risk sentiment prompts some selling around the safe-haven US Dollar amid expectations that the Fed will soften its hawkish stance. Any disappointment from the US Retail Sales figures will point to a slowdown in consumer demand and reaffirm bets for smaller interest rate hikes by the US central bank, which, in turn, should exert additional downward pressure on the greenback. Conversely, better-than-expected data should be enough to trigger a near-term short-covering around the buck. The immediate market reaction, however, is likely to be limited as traders assess the pace of the Fed's rate-hiking cycle.

Meanwhile, Eren Sengezer, Editor at FXStreet, offers a brief technical outlook and writes: “EURUSD returned within the ascending regression channel after having dropped below it late Tuesday. Additionally, the near-term bullish bias is confirmed by the Relative Strength Index (RSI) indicator on the four-hour chart edging higher toward 70 and the 20-period Simple Moving Average (SMA) staying intact.”

Eren also outlines important technical levels to trade the EUR/USD pair: “1.0400 (psychological level, static level) aligns as initial resistance. If EURUSD rises above that level and starts using it as support, it could target 1.0460 (static level)  and 1.0500 (psychological level, static level) next.”

“On the downside, 1.0350 (static level, 20-period SMA) forms first support before 1.0300 (static level, psychological level) and 1.0250 (static level),” Eren adds further.

Key Notes

 •  US October Retail Sales Preview: US Dollar unlikely to find reprieve

 •  US Retail Sales Preview: Forecasts from seven major banks, big boost in October

 •  EURUSD Forecast: Euro to stretch higher once it stabilizes above 1.0400

About US Retail Sales

The Retail Sales released by the US Census Bureau measures the total receipts of retail stores. Monthly per cent changes reflect the rate of changes in such sales. Changes in Retail Sales are widely followed as an indicator of consumer spending. Generally speaking, a high reading is seen as positive (or bullish) for the USD, while a low reading is seen as negative (or bearish).