April retail sales data issued by Commerce and NRF heads up

Ashley Carr
May 13, 2017

The Commerce Department said Friday that retail sales increased 0.4 percent in April from March.

Compared with a year earlier, total sales in April rose 4.5%.

Penney's net sales dropped 3.7 percent to $2.71 billion, declining for the third straight quarter and just short of the average analyst estimate of $2.77 billion, according to Thomson Reuters I/B/E/S.

As well as retail sales data, investors were also digesting the latest USA inflation figures. That is a major number and clearly can not be overlooked, especially when looking at how closely connected retail and consumer activity is tied to the freight transportation and logistics sectors on so many fronts, including trucking, intermodal, parcel, ocean, air, and e-commerce. Vehicle sales dropped, Americans spent less on home heating due to mild winter weather, and some households experienced delays in receiving tax refunds from the Internal Revenue Service.

Consumer confidence has soared since the presidential election, but spending hasn't increased as much as the jump in optimism would suggest.

EU raises euro zone growth forecasts
It said Italy's deficit is is set to decline "slightly" to 2.2% of GDP in 2017, compared to 2.4% in 2016 and 2.7% in 2015. Risks for euro zone economic growth have decreased from previous forecasts but remain "elevated", the commission said.

Hiring has been steady and the unemployment rate fell to a ten-year low of 4.4 percent in April.

The Federal Reserve, in a policy statement last week, said that "the fundamentals underpinning the continued growth of consumption remained solid".

Retail control-group sales, which are used to calculate GDP and exclude the categories of food services, auto dealers, building materials outlets and gasoline stations, rose 0.2 per cent after a 0.7 per cent March gain that was the biggest since April 2016.

All other sectors saw increases over April previous year. Even department stores eked out a 0.2 percent gain for the month, though they suffered a 3.7 percent decline for the year.

This story has been corrected to show that a category including department stores reported a 0.5 percent drop in sales. But the optimism is quelled to a degree, he noted, in that while consumers appear to have the resources to spend more than in the past, there is likely to be some hesitancy until there is more clarity in regards to policy changes regarding taxes, trade, and other issues.

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