• Retail Sales
  • -1.2 vs +0.2 forecast
• Core Retail Sales (excludes food/cars/gas/building materials)
  • -1.7 vs +0.4 forecast 
• Producer Price Index (core, y/y)
  • 2.6 vs 2.5 forecast 
• Jobless Claims
  • 239k vs 225k forecast

Traders may be taking Retail Sales data collection with a grain of salt, but this was a big enough miss that it demands to be traded.  Both stocks and bond yields have moved quickly lower in response.  10yr yields are down another 4bps from opening levels for a total of more than 5bps on the day (currently under 2.66).  Fannie 3.5 MBS are up a quarter point and 4.0 coupons are up just over an eighth of a point.

In addition to the sales data, don't forget that Jobless Claims are becoming a relevant data point again.  Simply put, they are increasingly speaking up about a potential shift in the labor market.  In fact, on a quarter-over-quarter basis, the labor market shift has long since been confirmed (incidentally, this reeks of "skills gap" considering the record high job openings 2 days ago, but then again, job openings tend to top out just before a labor/economic cycle shifts, and that data was from December).

Here's a chart of continued claims (on the top) and Q/Q rate of change in continued claims on the bottom.