U.S. Retail Sales in June Slowed by Drop in Gasoline Sales
by:Sandy Batten
|in:Economy in Brief
Summary
- Total sales increased 0.2% m/m in June, slightly below expectations, with an upward revision to May.
- Gasoline sales plunged 5.3% m/m, reflecting lower prices.
- Excluding gasoline sales, remaining sales rose a solid 0.7% m/m in June after a 0.9% monthly gain in May.
- Sales of the retail control group that is used to construct PCE rose 0.5% m/m in June and were up 9.2% at an annual rate in Q2 from Q1.
Total retail sales rose a slightly smaller-than-expected 0.2% m/m (6.7% y/y) in June following an upwardly revised 1.0% monthly gain in May (previously +0.9% m/m), according to data released by the U.S. Census Bureau. The Action Economics Forecast Survey looked for a 0.3% m/m gain. For all of Q2, total sales were up 2.9% q/q versus a 1.3% quarterly gain in Q1. Excluding autos, other sales fell 0.2% m/m (+6.9% y/y) in June after an upwardly revised 1.0% m/m increase in May (previously +0.8% m/m). Expectations were for an unchanged reading in June. For all of Q2, ex-auto sales were up 3.2% q/q versus 1.5% in Q1.
Retail gasoline prices fell markedly in June following the announced MoU between the US and Iran. Accordingly, gasoline sales plummeted 5.3% m/m, the first monthly decline since January, thereby markedly restraining total sales. Sales excluding gasoline were up a solid 0.7% m/m (5.7% y/y) in June following a 0.9% monthly increase in May. For all of Q2, ex-gasoline sales rose 2.1% q/q, up from 1.1% in Q1.
The control group of sales (total sales excluding food services, autos, gasoline and building materials that the BEA uses to construct PCE in the national accounts) posted another solid increase in June, rising 0.5% m/m (6.4% y/y) following an upwardly revised 0.8% monthly increase in May (previously 0.7% m/m). For all of Q2, control-group sales rose 2.2% (9.2% annualized) versus a 1.4% quarterly rise in Q1, auguring a Q2 pickup in consumer spending in the national accounts.
Sales across major sectors were mixed in June. Auto sales added to the May rebound with a 1.9% m/m jump in June on top of a 1.1% monthly increase in May. The 1.7% q/q rise in auto sales in Q2 was the strongest quarterly performance since Q4 2024. Electronic and appliance store sales rose 0.8% m/m in June, more than offsetting a 0.2% m/m decline in May. Sales at sporting goods, hobby and music stores jumped 1.3% m/m in June for a strong 4.8% quarterly gain in Q2, the largest quarterly gain since Q2 2021. Sales of nonstore retailers continue their stronger performance rising 1.9% m/m on top of a 1.4% monthly increase in May and a 1.5% monthly gain in April. Over the first six months of this year, nonstore retail sales have risen 9.6% (20.1% annualized).
By contrast, food and beverage store sales fell 0.2% m/m in June, the first monthly decline in four months. Sales at health and personal care stores declined 0.8% m/m, their second monthly decline in the past three months. Clothing sales fell 0.3% m/m in June. And miscellaneous store sales fell 0.3% m/m, the third monthly decline in the past four months. Sales at food services and drinking places, a popular indicator of discretionary spending, edged up only 0.1% m/m in June, down markedly from a 1.2% monthly gain in May and a 1.0% increase in April. And general merchandise store sales edged up 0.1% m/m in June.
Retail sales data can be found in Haver’s USECON database. The expectations figures are from the Action Economics Forecast Survey in AS1REPNA.
Sandy Batten
AuthorMore in Author Profile »Sandy Batten has more than 30 years of experience analyzing industrial economies and financial markets and a wide range of experience across the financial services sector, government, and academia. Before joining Haver Analytics, Sandy was a Vice President and Senior Economist at Citibank; Senior Credit Market Analyst at CDC Investment Management, Managing Director at Bear Stearns, and Executive Director at JPMorgan. In 2008, Sandy was named the most accurate US forecaster by the National Association for Business Economics. He is a member of the New York Forecasters Club, NABE, and the American Economic Association. Prior to his time in the financial services sector, Sandy was a Research Officer at the Federal Reserve Bank of St. Louis, Senior Staff Economist on the President’s Council of Economic Advisors, Deputy Assistant Secretary for Economic Policy at the US Treasury, and Economist at the International Monetary Fund. Sandy has taught economics at St. Louis University, Denison University, and Muskingun College. He has published numerous peer-reviewed articles in a wide range of academic publications. He has a B.A. in economics from the University of Richmond and a M.A. and Ph.D. in economics from The Ohio State University.
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