Retail sales went mostly nowhere in April, according to Census data.
The headline figure came in at 0.1%, down from a revised 1.5% from March and below 0.4% expectations. Ex-autos, sales didn’t climb at all; expectations were for a 0.6% gain. March was revised up to 1%. Ex autos and gas, sales slipped 0.1%, compared with an expected 0.5% gain and 1.4% revised March.
Import prices fell 0.4% from March compared with expectations for a 0.3% increase.
ED&FMan’s Tom DiGaloma called the report “shockingly weak,” and Capital Economics said they are no doubting whether Q2 annualised real consumption growth can surpass Q1’s 3.0% figure, though are not totally bearish. They write:
…the rebound in GDP growth in the second quarter may not be as large as we were expecting. Nonetheless, a rebound from the weather-induced weakness in the first quarter is still on the cards. Moreover, the strong run of employment gains suggests that the outlook for consumption is strengthening.
Pantheon Macro’s Ian Shepherdson says there was some late-Easter noise.
We doubt April sales really were as soft as these data suggest, just as we doubt March sales were anything like as strong as the +1.5% revised number. History shows clearly that the seasonal adjustments can’t cope with very late Easters, which tend to boost reported March sales at the expense of April, hence our forecast for weak-looking numbers. But taking March and April together, our measure of core sales – we exclude autos, gasoline and food – rose by an average of 0.8%, well above the prior trend. Looking at the whole winter period and the sub- sequent rebound, core sales still have a bit of catching up to do, but these numbers are nothing like as weak as the headline.
It’s true that there tends to be a lot of monthly noise in this data set, as you can see in the table on the left. But the year-over-year trend is unmistakable.
Here’s the table. The largest declines came from electronics and miscellaneous. Gains were seen in department stores and clothing.
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