Retail Sales Data Sends Dollar Surging

The greenback was surging Thursday after U.S. retail sales in May showed a much better-than-expected improvement.

One euro was buying $1.541, down from $1.5568 on Wednesday. The dollar was climbing to 108 Japanese yen from 106.9 yen previously, and the British pound was selling for $1.9458 vs. $1.9628 a day earlier. In each case, the dollar was stronger by roughly 1%.

Against both the Swiss franc and the Australian dollar, the U.S. currency was even sturdier, rising about 1.4%.

The move in the dollar followed a Commerce Department report that retail sales grew 1% during May, thrashing expectations of a 0.5% rise. In addition, the prior month's figure was revised upward to show a 0.4% increase from a 0.2% drop previously.

"The major concern in the markets has been U.S. growth and how the consumer would deal with higher gas prices and a slowing economy," says Robert Sinche, head of currency strategy at Bank of America in New York. "Clearly the data out today for May and the upward revisions for April are pretty impressive."

The CurrencyShares Euro Trust(FXE Quote), the CurrencyShares Japanese Yen Trust(FXY Quote) and the CurrencyShares British Pound Sterling(FXB Quote) were all off about 0.8%.

The CurrencyShares Australian Dollar Trust (FXA Quote) was losing 1.8%, while the CurrencyShares Swiss Franc Trust(FXF Quote) was down 1.2%.

In the metals markets, benchmark bullion futures were falling $18.20 at $864.70 an ounce in recent action on the Comex division of the New York Mercantile Exchange. The price of gold and the value of the U.S. currency tend to move in opposite directions.