Retail Sales Rose 0.5% in June

The consumer is still behaving well. This morning, the Census Bureau said that retail sales rose 0.5% last month. They also revised the figure for May up to +1.3%. If you take away cars and gas, then retail sales rose 0.3% last month.

From Bloomberg:

At the same time, a key subset of the data signaled less momentum: So-called retail-control group sales, which are used to calculate gross domestic product and exclude food services, auto dealers, building materials stores and gasoline stations, were unchanged in June after an upwardly revised 0.8 percent increase. The median estimate of economists was for a 0.4 percent gain in June.

A tight labor market and lower taxes have supported solid gains in household purchases, the biggest part of the economy. That, along with steady business investment, are among reasons growth was projected to double in the second quarter from the first three months of the year. Economists expect the pace of gains in household purchases to settle back in coming quarters.

Americans are increasingly concerned about the effects of Trump administration tariffs, which risk backfiring on consumption and the economy, though the levies largely haven’t yet been passed down to consumers.

As long as consumers are happy, then the economy will hold on. But all bets are off if this trade stuff gets out of hand.

Posted by on July 16th, 2018 at 9:32 am


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