Amid record low consumer sentiment, crashing asset markets, and tumbling savings rates, it is no surprise that May retail sales were a disappointment but the 0.3% plunge was remarkable relative to a 0.1% expected rise and downwardly revised 0.7% MoM rise in April.
That is the first negative print since Dec 2021.
Source: Bloomberg
Auto sales dropped 3.5% in May, reinforcing data from Ward’s Automotive Group that showed sales dropped the most since August in the month. Meantime, spending at gas stations rose 4%, likely reflecting higher fuel pricesin the month. Excluding those categories, retail sales rose 0.1%, the smallest gain in five months.
Remember, retail sales data is nominal – and so an inflationary impulse is actually ‘helping’ put some lipstick on this headline pig. Whiule adjusting retail sales by CPI directly is somewhat oranges to apples (due to different weightings tec), it gives some general sense of the state of ‘real’ retail sales. May was the third straight month of declines for real retail sales…
The Control Group – used in the GDP calculation – printed a blank (0.0% MoM). Additionally the Control Group retail sales data from April was revised dramatically lower from +1.0% MoM to +0.5% MoM suggesting Q2 GDP could be heading into contraction and the dreaded ‘technical’ recession looms.
Finally, as a reminder, the myth of the ‘strong consumer’ is dead as Americans are surviving by eating into their savings and piling up credit card debt as inflation sends the cost of living to the moon…
Source: Bloomberg
All of which is Putin’s fault of course.
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Moar government statistics that we all know to be truthful and accurate.
June numbers won’t be much better, trust me.
They will reinforce the prior month’s data that political bungling has aggravated the financial situation. Zero Hedge published a couple nice charts showing the shift from stocks to commodities and a couple stories of consumer credit cards quite possibly at their limits. Consumer retail is over half the economy, so it’s a good bet stocks, credit card companies and retailers are going to suffer along with the tapped-out proles over the next few months.
Eventually it will be spun…”all the stores are fully stocked but no one is buying. We have become a nation of hoarders. New legislation is in the works to rectify the situation”
I can’t wait to get the word from Captain Cadaver’s mutant pervert press secretary. I find her ignorance entertaining. Mayor Buttcheeks is a close second.
The new gal is more ignorant but less condescending and hateful.
Government reports on the economy are a grand waste of time. Everyone, even here in the cheap seats, can tell that folks are only spending money on gas and food, trying desperately to curtail all other outflows. Soon people will quit jobs and just stay home, preferring to beg, steal or pickup gig jobs. If you notice that the same scenery keeps passing by it’s because we are circling the bowl.
Never read better insight on the s__tshow we’re living in right now.
Unexpectedly.
Lack of money causes retail sales to tumble.