A stellar retail sales report takes the USD to fresh session highs and raises the probability of a more hawkish Fed at next week’s meeting. A beat across the board in the data where consensus had been looking for a contraction or flat. Now while the prior readings were revised lower, this has been shrugged off given the size of the beats in the latest figures. Most importantly, the retail sales control group reading rose 2.5% (vs -0.1% expected), which is noteworthy as it is used in several GDP trackers. Therefore, we may start to see US GDP forecasts upgraded.
