The US has seen its sharpest rise in retail sales for nearly two years as confidence returns to the world’s biggest economy.
Shoppers spent more on cars, electronic goods and petrol, creating an increase of 1.1% in September. Adding to the good news the US commerce department also revised August’s figures upwards to 1.2%.
The news will be a great boost to President Barack Obama as he prepares to take on Presidential challenger Mitt Romney at tomorrow night’s Live Presidential debate.
“Across the board it looks better. The sales of iPhones might have something to do it with a 4.5% rise in the electronics and appliances sales,” said Craig Dismuke, an economic strategist at Vining Sparks in Memphis, Tennessee.”This is a good end of third quarter and we have some good momentum to the fourth quarter.”
The latest report shows that the number of motor vehicles sold rose by 1.3%, electronic sales were up by 4.5%, food and beverages rose to 1.2% and petrol purchases climbed by 2.5%. The markets have been buoyed by the news with the Dollar rising against the Japanese Yen and the British Pound. The strong performance has increased demand for riskier currencies and has caused the Euro to make gains against the ‘Greenback’.
“Good retail sales should be decent for risk-taking at this point,” Brian Kim, a currency strategist at RBS Securities Inc., told Bloomberg. “The dollar is getting a little boost. The data is helpful to the U.S. dollar versus yen.”
Despite signs that consumer confidence is increasing in the USA the Federal Reserve has not made any indication that it is planning to reduce its support of the economy with a number of economists citing that the Fed would not rush its response to positive economic signals.
Adding to the sense of optimism, the Commerce Department reported that business inventories increased by 0.6% in August.
The Pound to Euro exchange rate is currently trading at 1.2404
The Pound to US Dollar exchange rate is currently trading at 1.6051
The Pound to Australian Dollar exchange rate is currently trading at 1.5678
The Euro to US Dollar exchange rate is currently trading at 1.2939
The Euro to Pound exchange rate is currently trading at 0.8060
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