U.S. Dollar Receives Boost
June 12, 2008
Cementing recent rhetoric from various Fed members regarding economic growth, May’s retail sales release was double market expectations. Retail sales picked up 1.0% and saw upward revisions to both March and April figures. Providing further rational for a USD rally, Philadelphia Fed President Charles Plosser said the Fed needs to act pre-emotively to make sure inflation expectations remain contained. He also stated that rates must rise, the only question being when. Following the optimistic data and Plosser’s hawkish comments the USD recorded a 0.2% increase against a basket of currencies.