Analysts at TD Securities explained that the markets are still coming to terms with last Friday’s US nonfarm payroll report, which had something for everybody. Key Quotes: "This week the main US data releases are Retail Sales and the Michigan confidence index, both on Friday. We expect total retail sales activity to post a further 0.1% M/M drop in January (consensus: +0.1%). Much of the weak performance will stem from a sharp drop in gasoline prices and weaker spending on autos. However, in line with the consensus we expect sales excluding autos and gas to rise by 0.3% M/M, while core retail sales activity should rise by 0.2% M/M (consensus: +0.3%), reflecting a rebound in spending momentum in January. We expect the Michigan confidence index to slip to 91.0 from 92.0 in February (consensus: 92.5), as global growth concerns reflected in the wobbly equity market performance filters into domestic consumer sentiment. Nevertheless, this impact should be relatively modest as lower gasoline prices and the sustained labour market buoyancy continue to provide a crucial underpinning for sentiment. Also Janet Yellen will make her semi-annual testimony on Capital Hill. TD expects Yellen’s remarks to be mostly balanced, reinforcing the Fed’s “wait and see” mode. At the same time she will continue to reiterate the Fed’s optimistic outlook for growth and inflation, though she will likely highlight the increased uncertainty surrounding that outlook. TD expects the tone of Yellen’s remarks to be mostly dovish, reinforcing the lowered odds of a March hike." For more information, read our latest forex news.