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US retail sales stronger than expected on electronics demand

DATA REACT
  • US retail sales were stronger than expected in October, particularly in the stripped down categories: total sales +1.7% M/M (survey +1.5%) and control group +1.6% M/M (+0.9%).
  • The major contributors of the uptick were electronics & appliances and building materials & garden, marrying up nicely with the stronger Home Depot /WMT earnings earlier today.
  • The main losers were food services & drinking places which were flat on the month as the sector's recovery continues to decelerate post-Delta.
  • International price pressures were also stronger than expected in October, with a small boost to the terms of trade as export price growth outstripped imports.
  • Initial market reaction saw Tsy yields rise very slightly across curve (2s/10s unchg at 108.5bps) and limited reaction from equities whilst USD index nudged up to new YTD highs.

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