Retail sales rose 0.4% in April, missing Wall Street estimates
Retail sales rose 0.4% in April from the previous month, representing just half the growth that Wall Street had expected.
Economists had forecast sales would rise 0.8% from the previous month after a surprise drop in March. This decline was revised to -0.7% after initially coming in at a 1% drop.
Excluding petrol stations and car sales, retail sales rose 0.6% in April. Six of the 13 categories highlighted in the release saw declines from a month ago. Sports equipment and hobbies saw the largest decline of all categories, falling 3.3% from last month and 5.4% from last year. Furniture and furnishing stores fell 0.7% from last month and 6.4% from last April. Growth at various retail and other retailers, which includes online sales, helped keep total sales higher than the previous month.
“Consumers remain inclined to spend even as they become more selective in their purchases,”[ads1]; Oxford Economics Lead US Economist Oren Klachkin wrote on Tuesday. “A stronger-than-expected handover to Q2 indicates that the main engine of GDP growth continues to hum. But with storm clouds gathering on the horizon, we think consumer spending will soon run dry.
“We expect a weaker labor market, depleted surplus savings buffers, tighter credit standards and high prices will make consumers less likely to spend in the second half of the year.”
The report, released by the Commerce Department, provides a snapshot of consumer spending at a time when the Federal Reserve has raised interest rates to curb inflation. The increase in retail sales in April comes as consumer prices rose at their slowest pace in two years during the month.
The report comes amid a week of highly anticipated quarterly results from retailers. Home Depot reported worse-than-expected earnings Tuesday morning, as revenue fell 4.2% from the same quarter last year.
Home Depot CEO Ted Decker said the company had “expected fiscal 2023 to be a year of moderation for the home improvement market.”
Target ( TGT ) TJX ( TJX ) Walmart ( WMT ) and Alibaba ( BABA ) are all expected to report later this week.
Josh is a reporter for Yahoo Finance.
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