14 July 2010 17:25 [Source: ICIS news]
WASHINGTON (ICIS news)--US retail sales fell by 0.5% in June from May, the Commerce Department said on Wednesday, marking the second monthly decline in a row and raising worries about a wobbly recovery.
In its monthly report, the department said that the nation’s retailers took in $360.2bn (€284.6bn) in June on a seasonally adjusted basis, down by 0.5% from May’s figures.
May retail sales had declined by 1.1% from April, according to the department’s revised figures.
However, market analysts noted that much of June’s decline in retail sales was attributed to a 2.5% drop in automobile and automotive parts businesses. With auto sales backed out of the overall figures, retail sales in June were down by a razor-thin 0.1%, essentially flat with May.
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A two-month decline in retail activity is worrying because consumer spending accounts for 70% of
If consumers are beginning to pull back, the recovery could be in trouble.
“Today’s data show that consumers continue to take a cautious approach toward shopping,” said Matt Shay, president of the National Retail Federation (NRF).
NRF chief economist Jack Kleinhenz also voiced concern that “consumer uncertainty remains”.
“A slow-growing economy and high unemployment rates will continue to hinder consumers’ decisions to spend on discretionary items,” Kleinhenz said.
The decline in consumer spending comes in the wake of sharp falls in the housing sector. Both housing and automotive manufacturing are key downstream consuming industries for chemicals and plastics.
On the plus side, the department and the federation noted that while June’s retail sales were down from May, last month’s measure of consumers’ willingness to spend was nearly 5% ahead of June 2009.
The NRF represents more than 1.6m
($1 = €0.79)
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