A new report from the U.S. Census Bureau showed that advance estimates of retail and food services sales in June totaled $506.8 billion. That was a 0.5 percent increase from May’s upward-revised print and the fifth monthly gain in a row. “Core” retail sales, which exclude the volatile automobile and gasoline components, also increased in June (+0.4 percent), helped by gains in eight of the thirteen major retail categories.
Notable strength last month was seen at car dealerships, health and personal care stores, restaurants, building materials outlets, and nonstore retailers (Amazon). The main detractors from headline sales growth in June were food and beverage retailers, department stores, and clothing outlets. Altogether this was another encouraging report on consumer spending that suggests U.S. gross domestic product (GDP) growth rebounded in the second quarter of 2018 following Q1’s seasonal slowdown. Much of the recent growth, though, has been fueled by increased credit card usage, suggesting that wage growth will likely need to pick up for sales to continue at this elevated level.
Sources: Econoday, U.S. Census Bureau, Bloomberg, FRBSLPost author: Charles Couch