Core retail sales in April rose .7% m/o/m which was 3 tenths above the estimate but offset by a one tenth downward revision to March and a 5 tenths lower revision to February. Auto sales were up by .4% m/o/m but down 2.8% y/o/y. Building materials grew by .5% but only after falling by a sharp 3.8% in March.
Sales elsewhere were really mixed. They fell in furniture, electronics, clothing, department stores and sporting goods. They rose in online retailing, misc stores (like pet and convenience stores for example) and at restaurants/bars. Spending on food/beverage fell for the 4th month in the past 5 but still up 2.9% y/o/y. Health/personal care sales grew by .9% m/o/m and 5.8% y/o/y.
Bottom line, the headline story will be the core retail sales beat but as stated it only comes after the lower revisions to the prior few months. Looking at sales ex gasoline, they are up 3.3% y/o/y in nominal terms which compares with the 20 yr average of 4.4%. This also compares with the April rise in core goods prices of 2%, thus REAL retail sales are barely growing. Anecdotally, and after hearing from companies and their Q1 earnings reports, the consumer spend is mostly focused on food, beauty, drug, leisure, travel and hospitality and not much on everything else.
The 2 yr yield is up 1 bp, staying above 4% and the 10 yr yield is higher by 2 bps, dancing above 3.5% for a 2nd day. Both are higher post sales report, but apparently only looking at the April data and not the revisions.
Retail Sales ex gasoline stations y/o/y
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