Forexlive Americas FX news wrap 14 Feb: Retail sales show consumer weakness to start year

• S&P misses on a record close. Nasdaq closes higher
• Key economic releases scheduled for next week’s trading.
• Fed Logan (voting in 26): Next couple of months of inflation will be pretty important
• Trump: Working on pipeline held up by New York to bring down energy prices
• TSMC is receptive to Intel factory deal
• Baker Hughes rig count little changed in the current week
• Ukraine’s Zelenskiy: Ready to move as fast as possilbe toward real peace
• Dell near deal to sell $5 billion in AI servers to Musk xAI
• Ukraine’s Zelenskiy: Its the first meeting, not the last
• European indices close mixed on the day. German DAX comes off its record close yesterday.
• BOC senior loan officer survey for Q4: -1.89% versus +1.71% prior
• The Atlanta Fed GDPNow growth estimate for Q1 lower to 2.3% from 2.9% last
• Meta planning on major advancement in AI powered humanoid robots
• US business inventories for December -0.2% versus 0.0% estimate
• Geopolitical comments: China’s Yi says that tariffs produce no winners
• US industrial production for January 0.5% versus 0.3% estimate
• Canadian consumer spending struggled in January – RBC
• US import prices for January 0.3% versus 0.4% est . Export prices +1.3% versus 0.3% est.
• US retail sales for January. -0.9% versus -0.1% est. Control group -0.8% versus 0.3% est.
• Canada manufacturing sales for December 0.3% vs 0.7% expected
• Kickstart the NA session with at technical look at the EURUSD, USDJPY and GBPUSD
• ForexLive European FX news wrap: A breather before US retail sales, more Trump headlines

US retail sales for January came in significantly weaker than expected, raising concerns about economic momentum as the new year begins. The control group, which feeds directly into GDP calculations, fell -0.8% (vs. +0.3% expected), while the headline figure dropped -0.9% (vs. -0.1% expected). In response, the Atlanta Fed’s GDPNow growth estimate for Q1 was revised down to 2.3% from 2.9%.

Other economic data showed mixed resilience—industrial production rose 0.5% (vs. 0.3% expected), and capacity utilization edged up to 77.8% (vs. 77.7% expected). However, business inventories declined by -0.2% (vs. 0.0% expected), signaling potential weakness in supply chain demand.

The US dollar weakened across the board today following the disappointing retail sales data, with all major currencies closing higher against the greenback. For the day, the New Zealand dollar led the gains with a rise of +1%, followed by the Australian dollar at +0.63%.

Both the Reserve Bank of Australia (RBA) and Reserve Bank of New Zealand (RBNZ) expected to announce interest-rate cuts when they meet on Tuesday and Wednesday respectively. The RBA is expected to cut rates by 25 basis points to 4.10% (86% probability), while the RBNZ has a 68% probability of a 50 basis point cut and a 32% chance of a 25 basis point cut from the current 4.25% level.

Despite the cut expectations, the AUDUSD rose 1.41% this week (AUD higher/USD lower). The NZDUSD rose an identical 1.41% for the week.

Looking at the other currencies vs the USD for the week:

• EURUSD rose 1.62% (lower USD)
• GBPUSD rose 1.58% (lower USD)
• USDJPY rose 0.61% (higher USD)
• USDCHF fell -1.05% (lower USD)
• USDCAD fell -0.81% (lower USD).

In the US debt yields moved lower in reaction to the weaker data as well:

• 2 year yield 4.263%, -4.8 basis point
• 5-year yield 4.331%, -5.5 basis points
• 10-year yield 4.478%, -4.7 basis points
• 30-year yield 4.703%, -2.3 basis points

For the week, yields were mixed with the two year down while the thirty-year rose modestly. The debt market did have to maneuver through higher-than-expected CPI and PPI data and a 10 and 30 year coupon auctions which were met with below average demand.

• 2 year yield, -4.1 basis points
• 5 year yield, -1.6 basis points
• 10-year yield, -1.5 basis points
• 30-year yield, +0.8 basis points

The major US stock indices close with mixed results today. The Dow industrial average is lower, the S&P index was unchanged, and the NASDAQ index was higher. The S&P closed within four points of a record level. For the trading week the NASDAQ index had its best week of the year with a gain of 2.58%. It outpaced the more modest gains in the Dow industrial average and the S&P indices.

• Dow rose 0.55%
• S&P rose 1.47%
• Nasdaq rose 2.58%

Worth mentioning is that Meta shares closed higher for the 20th consecutive day today.

Looking at other markets as the week came to a close:

• Crude oil fill -0.79% or -1.12% at $70.49. For the week the price fell -0.68%.
• Silver fell $-0.19 or -0.60% to $32.13. For the week the price rose 1.489%
• Gold tumbled $45.09 for -1.54% to $2882.21 in trading today. For the week the price rose 0.77%, and traded to a record intraday level of $2942.71
• Bitcoin (which never closes) rose $900 today to $97,500. For the trading week, the high price reached $98,871 while the low price was at $94,091

This article was written by Greg Michalowski at www.forexlive.com.