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Economy in Brief

U.S. Retail Sales Rose Just Slightly in June
by Tom Moeller July 15, 2008

U.S. retail sales during June inched up just 0.1% after having risen a downwardly revised 0.8% in May. On a three-month basis overall retail sales rose at a 4.5% annual rate. The latest rise fell short of Consensus expectations for a 0.4% increase.

Sales of motor vehicles & parts fell another 3.6% (-10.5% y/y) and they are down at a 27.0% annual rate during the last three months. The decline accompanied a 4.6% (-13.1% y/y) drop in unit motor vehicle sales last month.

Retail sales excluding autos rose 0.8% and the strong 1.2% rise in May was unrevised, boosted recently by receipts of the government's tax rebate checks. The latest increase was double Consensus expectations for a 0.4% rise, but a 4.6% (24.5% y/y) increase in sales at gasoline service stations accounted for much of the strength.

Less gasoline & autos retail sales inched up just 0.2% (3.6% y/y) which was the weakest increase since February. Nevertheless, on a three-month basis these sales still were strong and surged at an 8.8% annual rate during the last three months.

Folks attempted to avoid the higher gas prices by purchasing online. June sales of nonstore retailers (internet & catalogue) rose 0.8% (8.1% y/y) following downwardly revised, but still strong, gains which exceeded 1.0% during the prior three months.

Sales at general merchandise stores rose 0.4% (5.6% y/y) following the 1.3% pop in May. Sales offurniture, home furnishings & appliance, however, reversed all of the upwardly revised May surge of 1.0% (-0.1% y/y). Sales of furniture & home furnishings declined 1.4% (-5.4% y/y). Apparel store sales rose 0.6% (2.9% y/y), about the same as they did during the prior three months.

Building materials & garden equipment sales fell 0.9% (+1.5%% y/y) after gains which exceeded 2.0% during the prior two months.

Released yesterday, the Federal Reserve Board's final rule for home mortgage loans to better protect consumers and facilitate responsible lending can be found here.

Doom & Gloom in the Housing Markets: The Sequel from the Federal Reserve Bank of St. Louis is available here.

  June May Y/Y 2007 2006 2005
Retail Sales & Food Services 0.1% 0.8% 3.0% 4.0% 5.8% 6.4%
  Excluding Autos 0.8% 1.2% 6.2% 4.5% 6.8% 7.5%
    Less Gasoline 0.2% 0.8% 3.6% 4.1% 6.2% 6.4%
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