US retail sales rose less than expected in May

Thursday 12 June 2014 14.51
Economists had predicted a 0.6% rise in retail sales during the month
Economists had predicted a 0.6% rise in retail sales during the month

US retail sales rose less than expected in May, but that probably will do little to change expectations of an acceleration in growth this quarter as data for the prior months was revised higher.

The country’s Commerce Department said retail sales gained 0.3% last month. 

Retail sales, which account for a third of US consumer spending, rose by a revised 0.5% in April.

Economists polled by Reuters had forecast sales gaining 0.6% after a previously reported 0.1% rise in April.

Reports on employment, manufacturing and services industries have suggested growth would rebound strongly in the second quarter after the economy contracted at a 1% annual rate in the January-March period.

So-called core sales, which strip out cars, petrol, building materials and food services, and correspond most closely with the consumer spending component of gross domestic product, were unchanged last month.

Core sales were, however, revised to show a 0.2% rise in April after previously being reported to have slipped 0.1%.

In May, consumers bought cars and receipts at car dealerships increased 1.4%.Excluding cars, sales were up 0.1% in May.

Sales at building materials and garden equipment stores rose 1.1%. 

There were also increases in sales at non-store retailers, which include online sales. Sales at petrol stations rose 0.4%, reflecting higher pump prices.

There were, however, declines in receipts at sporting goods shops. Sales at electronics and appliances stores fell as did those at clothing retailers and restaurants and bars.  

Meanwhile, new claims for US unemployment insurance benefits edged up last week but the overall trend showed slow but steady improvement in the labor market, official data showed today.

New claims, a sign of the pace of layoffs, rose by 4,000 to 317,000 in the week ending June 7, the Labor Department said.

The previous week's claims number was upwardly revised to 313,000 from 312,000. Last week's increase in claims was slightly above the consensus analyst estimate of 315,000.

But though the four-week average of new claims rose by 4,750 to 315,250, the broad trend has been for a decline in claims. 

A year ago the average stood at 344,500 claims.

For all people receiving unemployment insurance benefits, the four-week moving average fell by 13,000 to a pre-recession low of 2.62 million, the lowest level since late November 2007.

The US unemployment rate held steady at 6.3% in May, unchanged from April.