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Retail sales data may move markets when the economy’s outlook is in doubt
A recent CME ranking placed Retail Sales above CPI, PPI, and PCE, and bond traders largely ignored the latest reading as fuel price volatility and temporary factors limited its signal.
Mortgage News Daily says Retail Sales is often treated as a high-impact economic release, citing research papers and the view among economic calendar providers that the report can be a top tier market mover. The outlet adds that a CME effort ranked Retail Sales 5th, ahead of CPI, PPI, and PCE.
However, the publication argues Retail Sales tends to drive meaningful market movement mainly when there is an open question about the economy’s health. It also says markets can look past the data when temporary factors are in play, pointing to fuel price volatility and noting that other calendar-linked items such as Amazon Prime Day are frequently cited as reasons to discount month-to-month discrepancies.
In the current trading snapshot described by Mortgage News Daily, bonds largely ignored the data and continued their focus on positioning for the weekend and/or pushing the yield curve steeper, with Fed Funds Futures leading the way.