Preview: Due August 14 - U.S. July Retail Sales - Some loss of momentum, but still resilient
We expect June retail sales to unchanged overall, the weakest since a matching January, with a 0.2% increase ex autos, which would reverse a 0.2% June decline. Ex auto and gasoline we expect a second straight 0.4% increase.
Gasoline prices are likely to remain a significant negative in July if less so than in June, in a continued correction from positive contributions in March, and to a lesser extent April and May.
Industry data suggests a modest correction lower in auto sales after two straight increases.
Consumer spending was impressively resilient in Q2 despite weakness in real disposable income. June’s 0.4% gain ex auto and gasoline was the slowest since a matching January, though some of the slowing was probably due to prices. We expect a similar gain in July, signaling only a modest loss of momentum.
We expect some slowing in most of the components ex auto and gasoline, but food and sales at eating and drinking places look due for modest gains after weak June outcomes, keeping the overall pace similar to June’s.
