Retail Sales: Massive Rebound Across Most Segments
June 16, 2020
Bottom Line: Total retail spending rebounded sharply in May, mostly in-line with higher frequency nowcasting data that showed the consumer was strong in May, despite massive job losses. Substantial and rapid unemployment insurance programs and stimulus checks for most taxpayers aided the rebound. Gains were broad across the key categories. That said, most segments still saw a net contraction of a historic magnitude over the three months ended in May. Food and beverage, as well as personal care segments, saw sharp gains in March, bucking the trend as consumers stocked up on these products before shutdowns -- but those categories have since seen net contraction and were the only segments with only modest growth in May. Overall, these figures confirm the bottom in consumption and an on-going rebound amid massive government stimulus programs in the wake of the shutdowns for the novel coronavirus. Retail Sales ROSE by 17.7% in May, compared with the market consensus for an increase of 8.4%. The April estimate was revised from -16.45% to -14.75%. Retail sales are now 6.1% BELOW their year-ago level; just a year ago, the year over year growth rate was 2.9%. Spending at motor vehicle dealers climbed by 44.1%. Core Retail Sales ROSE by 12.4%, compared with the market consensus for an increase 5.5%. The April estimate was revised from -17.24% to -15.22%. Core retail sales are now 6.6% BELOW their year-ago level; just a year ago, the year over year growth rate was 2.9%. Nonstore retailers (+9.0%), clothing stores (+188.0%), furniture & home furnishing (+89.7%), building materials (+10.9%) saw notable increases. Core Retail Sales ex Gasoline ROSE by 12.40% and are now 3.9% BELOW their year ago level; just a year ago, the year over year growth rate was a moderate 3.2%.
Article by Contingent Macro Advisors