Here is what you need to know on Friday, February 16:
The US Dollar (USD) extended its downward correction following mixed data releases on Thursday, with the USD Index (DXY) losing 0.4% on the day. The USD stays resilient against its rivals early Friday as focus shifts to January Producer Price Index (PPI) data. Later in the American session, the University of Michigan will release the preliminary Consumer Sentiment Index for February.
The US Census Bureau reported on Thursday that Retail Sales declined 0.8% on a monthly basis in January. On a positive note, weekly Initial Jobless Claims came in at 212,000 for the week ending February 10, down from 220,000 in the previous week. The benchmark 10-year US Treasury bond yield retreated toward 4.2% and Wall Street's main indexes registered modest gains after the data, not allowing the USD to gather strength. In the European morning, the 10-year yield stays in positive territory near 4.25% and US stock index futures trade mixed.
Retail Sales in the UK rose 3.4% on a monthly basis in January, the UK's Office for National Statistics announced early Friday. This print surpassed the market expectation for an increase of 1.5% by a wife margin. Retail Sales ex-Fuel grew 3.2% in the same period. Pound Sterling failed to benefit from the upbeat data and GBP/USD was last seen fluctuating at around 1.2600.
Bank of Japan (BoJ) Governor Kazuo Ueda said on Friday that they will examine whether to maintain various easing measures, including negative interest rate, when a sustained and stable achievement of the price target comes into sight. Ueda refrained from commenting on the short-term fluctuations in the forex markets and possible factors behind such moves. After closing the previous two trading days in negative territory, USD/JPY stabilized near 150.00 and edged higher during the Asian trading hours.
Reserve Bank of New Zealand (RBNZ) Governor Adrian Orr repeated early Friday that they have more work to do to get inflation expectations anchored to the 2% target. "Bringing core inflation down to within the 1-2% target band is an important part of bringing overall inflation down to the 2% target," Orr added. NZD/USD largely ignored these comments and was last seen trading marginally lower on the day at around 0.6100.
EUR/USD gathered recovery momentum and climbed above 1.0750 on Thursday. The pair holds steady above this level in the European morning on Friday.
Gold snapped a five-day losing streak on Thursday and closed above the key $2,000 mark. XAU/USD trades in a narrow channel slightly above this level on the last trading day of the week.
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