After strong gains over the previous months, US retail sales cooled significantly down in April. Retail sales rose by 0.1% M/M, in line with expectations, while the previous figure was slightly downwardly revised from 0.8% M/M to 0.7% M/M. The details show that weakness was based in building materials (-1.8% M/M), gasoline station sales (-0.3% M/M), clothing (-0.7% M/M) and department store sales (-1.4% M/M). Sales of non-store retailers (1.1% M/M), sporting goods (0.7% M/M), furniture (0.7% M/M), health & personal care (0.6% M/M), motor vehicles & parts (0.5% M/M) and eating & drinking (0.4% M/M) remained strong in April. Retail sales excluding autos and gas rose also by 0.1% M/M, while the control group remained strong, increasing by 0.4% M/M. The breakdown suggests that the slowdown in retail sales might be due to less favourable weather in April, while there might have been some pay-back too after pre-Easter shopping in March. In the coming month, it will be interesting to see whether retail sales pick up again after a weather-related pay-back.
In May, the NY Empire State manufacturing index reversed most of its previous month’s decline. The headline index rebounded from 6.56 to 17.09, while the consensus was looking for only a slight improvement (to 9.00). The details show a sharp improvement in shipments (24.14 from 6.41) and average workweek (12.05 from 6.02), while a more limited pick-up was registered in new orders (8.32 from 6.48), inventories (4.82 from 1.20), unfilled orders (-4.82 from -7.23) and number of employees (20.48 from 19.28). Delivery time (0.00 from 4.82) weakened somewhat and both prices paid and prices received eased in May. Although last month’s decline was probably excessive, the rebound is an encouraging sign, suggesting that the US manufacturing sector continues to grow steadily.