Retail sales in June were essentially unchanged, aligning with economists’ expectations, according to the latest data from the Census Bureau.
- Despite sales year-over-year sales still posted a 2.3% increase compared to the same period last year.
Sales Rise: Online retailers led the pack with a robust 1.9% increase in sales. Building materials and garden supply stores followed with a 1.4% rise, and health and personal care stores saw a 0.9% uptick. Department and electronics stores also experienced modest growth, each reporting a 0.4% increase in sales.
- Conversely, several sectors saw declines. Gas stations experienced a notable 3.0% drop in sales, while auto dealers and parts shops saw a 2.0% decrease. Sporting goods stores reported a slight dip of 0.1%.
Adjusted For Inflation: Despite a 0.1% decline in prices during June, the overall picture for retail sales remains positive for the month. However, the annual growth rate of 2.3% continues to trail behind the 3.0% inflation rate, highlighting ongoing economic challenges.
What They’re Saying: Mohamed A. El-Erian of Queens College noted, “Retail sales came in stronger than expected at every level, including a 0.9% advance in the ‘control group’ relative to the consensus forecast of 0.2%. Given the Fed’s strong data dependency, this will curtail the hope that a minority had after prior releases that a rate cut could come as early as this month.”
- Conor Sen described the results as indicative of “super strong retail sales.”
Fed Watch: The chance of a rate cut in September fell slightly to just under 90% according to the the latest data from the CME Fed Watch tool. While this is down from the last few days, it is still well above the 70% reading seen one month ago.
