-Retail Sales Excluding Motor Vehicles Rise 7.3%; Vehicle Sales Up 8.2%
-Initial Jobless Claims Fall by 10,000 to 1.310m in the July 11 Week
-Philadelphia Fed Index Dips to 24.1 in July from 27.5 in June
-NAHB Index Rises To 72 in July From 58 in June, Almost Pre-COVID Level
-Business Inventories Fall 2.3% in May, Business Sales Up 8.4%
By Kevin Kastner
WASHINGTON (MaceNews) – Retail sales rose further in June, as social distancing was eased further in many states, but a rebound of COVID-19 cases in July may result in a pullback in next month’s data.
Total retail sales rose by 7.5%, ahead of the 5.2% gain expected, the Commerce Department reported Thursday, with increases seen in almost every category. Motor vehicle sales rose by 8.2% as low interest rates and rising consumer confidence increased buyer traffic.
Retail sales excluding motor vehicles rose by 7.3% in June, well above the 5.2% gain expected. Gasoline station sales jumped by 15.3% after an 11.9% gain in May.
Clothing stores sales surged by 105.1% in the month, showing further recovery and lifted by an increase in apparel prices at the consumer level.
Food services and drinking place sales rose by 20.0% after a 31.5% gain in May, as restaurants further reopened their doors. Building material sales fell by 0.3% in the month after a 12.2% May increase.
Sales at nonstore retailers, which represent internet-based outlets, fell by 2.4%, as consumers shifted toward in-person shopping where it was safe after months of ordering over the Internet from home. Food store sales fell by 1.2%.
The closely-watched control group – total sales excluding motor vehicles, gasoline, building materials, and food services – rose by 5.7% after a 9.8% gain in May. Analysts expected control group sales to rise by 3.5%.
May retail sales were revised up to an even-stronger 18.2% gain from the 17.7% jump previously reported, while ex-motor vehicle sales were revised down slightly to a 12.1% increase from the previously reported 12.4% rise.
In other data released at the same time, the level of initial jobless claims fell by only 10,000 to a 1.300 million level in the July 11 week, above the 1.288 million level expected. The four-week moving average fell by 60,000 to 1.375 million.
The pace of decline in initial claims continues to flatten and the level remains stubbornly above a million, suggesting that layoffs (in some cases for the second time) continue.
Unadjusted claims posted a solid increase, up 108,811. Seasonal adjustment factors expect a large gain this week due to usual auto retooling shutdowns, but this year the gain can’t be attributed to just filings in that sector.
The unadjusted state data showed large gains in Florida, California, and Georgia, states where COVID cases have seen an upward trend.
Continuing claims fell by 422,000 to 17.338 million in the July 4 holiday week. It will be several months before extended claims benefits run out for many people, so any reduction in the level of continuing claims will be based on rehiring activity.
Also released at the same time, the Philadelphia Fed index fell to 24.1 in July from 27.5 in June, still above the 20.0 reading expected. The Empire State index released on Wednesday indicated growth in that region for the first time since February.
Other regional data will be released before the ISM national measure on August 3, so it is hard to get a national view now. The recent rebounds in the Northeast regions are a positive sign but are not a surprise given how badly they suffered through the shutdowns. The really telling stats will be from the regions that were previously less impacted but are now seeing a resurgence of cases.
Released later in the day, the National Association of Home Builders July housing market index reading to a reading of 72 from 58 in June and 37 in May, with gains in the present situation, 6-month outlook, and buyer traffic measures.
The index is now only slightly below the reading of 74 in February before the shutdowns.
Business inventories fell by 2.3% in May, with retail inventories revised down slightly to a 6.2% decline from the 6.1% drop in the advance reading. Wholesale inventories were already reported down 1.2%, while factory inventories rose 0.2%.
Business sales surged by 8.4%, with much stronger sales at all three levels of the pipeline.
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Contact this reporter: kevin@macenews.com
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