The strong high demand in the American economy was maintained in June, which lays the groundwork for an even greater increase in interest rates by the Fed in order to fight rapid inflation.
In particular, as announced by the US Commerce Department, retail sales in June showed a 1% increase compared to a month earlier, exceeding the estimates of analysts in a Reuters survey who expected a 0.8% increase.
However, it is worth noting how fluid the macroeconomic environment is, as the forecasts of the analysts who participated in the survey ranged in an extremely wide range, from a drop of 0.2% to a jump of 2.2%.
Elsewhere, the data showed May sales were revised down, to a 0.1% decline versus a 0.3% increase initially reported.
June’s increase was largely driven by gasoline, which hovered above $5 a gallon and sent gas station sales soaring.
Since then, of course, the price has fallen significantly and is now hovering just over $4.50 a gallon.
Retail sales were also boosted by a recovery in the motor vehicle aftermarket, which had been hit by shortages.
Excluding autos, gasoline, building materials and food services, in the index’s so-called structural measure, retail sales rose 0.8 percent in June.
Related figures for May, however, were also revised downwards, showing a 0.3% decline in structural retail sales instead of the first reading which had shown them unchanged.
The measure of structural retail sales is more reflective of the consumer spending component of GDP, and despite June’s rise, adjusted for inflation it is estimated to have been soft.
Source: Capital
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