U.S. retail sales unexpectedly stalled in April as the boost from stimulus checks faded, but an acceleration is likely in the coming months amid record savings and a reopening economy.
The Commerce Department said on Friday the unchanged reading in retail sales last month followed a 10.7% surge in March, an upward revision from the previously reported 9.7% increase.
Economists polled by Reuters had forecast retail sales would rise 1.0%. Economists polled by Dow Jones had expected a more modest 0.8% increase.
Many qualified households received additional $1,400 checks in March, which were part of the White House’s $1.9 trillion COVID-19 pandemic rescue package approved early that month.
Retail sales account for the goods component of consumer spending, with services such as healthcare, education, travel and hotel accommodation making up the other portion. Households have accumulated at least $2.3 trillion in excess savings during the pandemic, which should underpin spending this year.
Excluding automobiles, gasoline, building materials and food services, retail sales dropped 1.5% last month after an upwardly revised 7.6% increase in March. These so-called core retail sales correspond most closely with the consumer spending component of gross domestic product. They were previously estimated to have shot up 6.9% in March.
Source: CNBC
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