Wednesday 14th May

Taking out car sales, US April retail sales numbers rose a bigger than expected 0.5 per cent and this news gave the US currency a boost as it rose against the Yen and held early morning gains against the Euro yesterday.

Traders are now awaiting the release of the April CPI number from the US (later today) for further clues as to whether the Fed will take a pause from cutting interest rates at its next policy meeting in June. If the retail sales number has prompted market players to think the Fed has done with cutting rates they will be even more convinced if the CPI number comes in on the firm side.

But no one is thinking that the US economy is on track for a full recovery unless the housing and financial sectors show a strong and fundamental improvement and at present that seems a long way off.

Not easy trading conditions and we could do with more momentum out there.