Retail sales rose a modest 0.1% in April, narrowly beating economists’ expectations of a flat reading, according to the latest data from the Commerce Department.
- While the pace was far slower than March’s robust 1.7% surge, it still marked the second-strongest monthly performance of the year and kept annual growth firmly positive.
Year-Over-Year: Compared to a year ago, retail sales are up 5.2%—matching March’s annual pace and continuing to outpace consumer inflation, which rose just 2.3% year-over-year in April.
Breaking It Down: Sales at sporting goods stores fell 2.5%, while online retailers posted a 2.1% drop. Department stores also struggled, with sales slipping 1.4%, and gasoline sales dipped 0.5% as pump prices remained relatively steady.
- Dining out remained a strong point, with bar and restaurant sales rising 1.2% in April, signaling continued demand for experiences and services. However, several major categories took a hit.
Impact on Rates: Sales were either flat or down for three of the last four months. This should be slightly concerning to the Fed about the health of the economy. However, year-over-year sales continue to outpace inflation by a large margin giving a mixed outlook on consumer behavior.