Ironside Macroeconomics Managing Partner Barry Knapp speaks about “The Age of Financialization” during Unbreakable Investor’s “Making Money” town hall.
U.S. retail sales were flat in June, signaling a strong underlying trend that could boost second-quarter economic growth forecasts.
The Commerce Department’s Census Bureau said Tuesday that retail sales last month were flat, following an upwardly revised 0.3% increase in May.
Economists polled by Reuters had expected retail sales, which are mainly made up of goods and are not adjusted for inflation, to fall 0.3 percent after rising 0.1 percent in May.
Inflation unexpectedly falls to 3% in June
A woman shops for household goods at a retail store in Rosemead, California on January 19, 2024. (Photo by FREDERIC J. BROWN/AFP via Getty Images) / Getty Images)
Still, the sales outlook is not good.
As evidenced by earnings reports from major retailers and manufacturers, households are becoming more price-conscious and prioritizing basic needs.
Where are rising prices still hitting Americans hardest?
PepsiCo CEO Ramon Laguarta said last week that low-income consumers are “struggling” and “turning to different strategies to make ends meet through the end of the month.”
PepsiCo CEO Ramon Laguarta gestures as he speaks during a panel session on the third day of the World Economic Forum (WEF) in Davos, Switzerland, Thursday, January 24, 2019. (Jason Alden/Bloomberg via Getty Images/Getty Images)
Most households are taking on large amounts of credit card debt, using up excess savings they had accumulated during the COVID-19 pandemic. With interest rates remaining high, this debt burden is becoming more burdensome. Wage growth has slowed as the labor market has cooled. Still, the pace of consumer spending remains strong enough to keep the economic expansion on track.
| Ticker | safety | last | change | change % |
|---|---|---|---|---|
| Pep | PepsiCo Inc. | 163.86 | -2.52 | -1.51% |
Retail sales excluding autos, gasoline, building materials and food services jumped 0.9% last month after rising 0.4% in May. These so-called core retail sales correspond most closely to the consumer spending component of gross domestic product.
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Before the retail sales data was released, growth estimates for the April-June quarter were around 2%. The economy grew 1.4% in the first quarter.
