How U.S retail sales surpassed expectations in June
U.S. retail sales grew more than expected in June, pointing to strong customer spending. The Commerce Department said on Tuesday retail sales rose by 0.4%. Last month Americans purchased more motor vehicles and a mixture of other goods.
Economists polled by Reuters had forecast retail sales edging up 0.1% in June. Compared to June last year, retail sales advanced 3.4%. Excluding automobiles, gasoline, building materials and food services, retail sales jumped 0.7% last month after an upwardly revised 0.6% increase in May. Consumer spending component of gross domestic products was previously reported to have increased by 0.4% in May.
June’s healthy gain in retail sales suggested a sharp acceleration in consumer spending in the second quarter. The Federal Reserve also cut interest rates in June for the first time in a decade. Signs of, strong consumer spending and rising core inflation suggest the U.S. central bank is unlikely to cut rates by 50 basis points at its July 30-31 policy meeting as markets had initially anticipated.
Receipts at clothing stores rose by 0.5%. Online and mail-order retail sales climbed 1.7%, matching May’s increase. Sales at furniture stores also rose by 0.5%. Sales at restaurants and bars surged 0.9%, and spending at hobby, musical instrument and book stores was unchanged. Retail sales continue to do well, and many businesses can remain optimistic about 2019 as consumers are spending more than before.
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