US Retail Sales Boom Well Above Forecasts, Rise 4% On The Year: 'Blowout Report,' Economists Say
Portfolio Pulse from Piero Cingari
U.S. retail sales in March exceeded forecasts with a 4% annual growth, driven by increases in non-store retailers, gasoline stations, and miscellaneous store retailers. Despite higher inflation, consumer spending remains strong. Treasury yields rose, impacting the iShares 20+ Year Treasury Bond ETF (TLT), which fell 1.6%. Analysts view the report as a sign of robust economic activity, suggesting the Fed may delay rate cuts.
April 15, 2024 | 4:25 pm
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NEGATIVE IMPACT
The iShares 20+ Year Treasury Bond ETF (TLT) fell 1.6% as Treasury yields spiked following the strong U.S. retail sales report for March.
The drop in TLT's price is directly linked to the reaction of Treasury yields to the unexpectedly strong retail sales report. As yields rise, bond prices, including those of TLT, typically fall. The report led investors to adjust their expectations for Federal Reserve rate cuts, impacting bond market volatility and TLT's performance.
CONFIDENCE 85
IMPORTANCE 80
RELEVANCE 90