The Commerce Department released a report on Tuesday revealing that U.S. retail sales remained unchanged in June, as considerable declines in auto and gasoline sales were counterbalanced by gains in other sectors.
According to the report, retail sales were flat in June following a revised upward increase of 0.3 percent in May. This result was in line with economists' expectations, who had predicted no change after the originally reported 0.1 percent rise in the previous month.
The report highlighted a significant drop in sales from motor vehicle and parts dealers, which fell by 2.0 percent in June after a 1.0 percent increase in May. Excluding this downturn, retail sales rose by 0.4 percent in June, compared to a modest 0.1 percent increase in May. Ex-auto sales were anticipated to edge up by 0.1 percent.
Despite a 3.0 percent drop in gas station sales, there were notable increases in other areas: building materials and supplies dealers saw sales rise by 1.4 percent, non-store retailers experienced a 1.9 percent increase, and health and personal care stores also reported significant growth.
Core retail sales, which exclude automobiles, gasoline, building materials, and food services, surged by 0.9 percent in June, following a 0.4 percent rise in May.
Michael Pearce, Deputy Chief U.S. Economist at Oxford Economics, commented, "Even though headline retail sales were unchanged in June, the underlying details were strong. Along with upward revisions to past data, this suggests that real consumer spending increased by nearly 2% annualized in Q2, slightly above our baseline forecast."
He further noted, "The strength of household balance sheets and the resilient labor market will continue to support solid consumer spending in the second half of 2024."
