Tuesday, May 13 14:06:19
U.S. retail sales barely rose in April, tempering hopes of a sharp acceleration in economic growth in the second quarter.
The Commerce Department said today retail sales edged up 0.1 percent last month, held back by declines in receipts at furniture, electronic and appliance stores, restaurants and bars and online retailers.
Retail sales, which account for a third of consumer spending, rose by a revised 1.5 percent in March. That was the largest increase since March 2010 and reflected pent-up demand after a brutally cold winter.
Economists had forecast sales advancing 0.4 percent last month after a previously reported 1.2 percent surge in March.
U.S. Treasury debt prices rose on the data, while the dollar trimmed gains versus the euro.
"You really had a spectacular March. You are now having an April hangover ... The reality of the economy is decent but not great. Some people over-extrapolated the March numbers," said Guy Berger, an economist at RBS in Stamford, Connecticut.
Data such as employment, as well as manufacturing and services industries surveys had suggested the economy regained strength early in the second quarter after being weighed down by bad weather and a slow pace of restocking by businesses in the first three months of the year.
But the retail sales report cast a shadow on that upbeat outlook. So-called core sales, which strip out automobiles, gasoline, building materials and food services, and correspond most closely with the consumer spending component of gross domestic product, fell 0.1 percent in April.
That followed a revised 1.3 percent advance in March. Core retail sales had previously been reported to have risen 0.8 percent in March.
Tepid demand could see inflation pressures remaining benign for a while. In a separate report, the Labor Department said import prices fell 0.4 percent last month after rising 0.4 percent in March.
Economists polled by Reuters had forecast import prices rising 0.3 percent last month. In the 12 months through April, import prices fell 0.3 percent.
The lack of inflation pressures in the economy suggests the Federal Reserve could keep monetary policy very accommodative for a while even as labour market slack starts to ease. (Reuters)