Market participants expect Retail Sales to rebound by 0.8% MoM in February after unexpectedly falling 0.8% MoM in January. Importantly, the Control Group Retail Sales (which exclude cars, gas, food services, and building materials and feed into the GDP calculation) is forecast to rise by 0.4% in February following a 0.4% decline the previous month.

Robust US consumer spending activity will further curtail money market expectations of Fed funds rate cuts and add upside momentum to USD. In contrast, any evidence that spending is buckling under the weight of higher interest rates and depleting excess savings can trigger another downside correction in USD.