Core Retail Sales is an indicator that measures the change in the U.S. retail sales volume, excluding automobiles and gasoline.
Why is it important?
Consumption is an essential component of the national GDP. In the U. S. consumption accounts for 70% of the gross domestic product. Though the GDP itself has no direct influence over the exchange rates, it can seriously influence the stock market by providing important information on the well-being of the national economy. As a rule, the more people consume, the healthier the economy. Core Retail Sales help experts to determine how good the consumption-related portion of the national economy is doing.
Applying Core Retail Sales to trading
Increased consumer spending is generally connected with flourishing living conditions, while the contraction of the Retail Sales index is usually a sign of deteriorating well-being of the middle class. Both are serious signals for long-term investors and speculation-oriented traders. A higher than expected reading is considered to be positive for the USD, while a lower than expected reading is considered to be negative for the USD.
