US Retail Sales Preview: Forecasts from six major banks, losing speed in July

The US Census Bureau will release the July Retail Sales report on Wednesday, August 17 at 12:30 GMT and as we get closer to the release time, here are the forecasts of economists and researchers of six major banks regarding the upcoming data. 

Retail Sales are forecast to decline to 0.1% in June with the ex-autos to -0.1% and control to 0.6%. 

Commerzbank

“We expect only a small increase in retail sales of 0.2% due to falling gasoline prices. Such a figure would prove that the US economy has not yet slipped into a real recession, even though it contracted in the first half of the year.”

TDS

“We look for retail sales to lose speed in July (0.1%), following a notable 1% MoM jump in June. Spending was likely dented by a sharp drop in gasoline station sales, which should have been offset by a strong showing in control group sales (0.8%) – supported by Amazon's Prime Day. Sales ex-auto & gas should have also advanced by a solid 0.6% m/m. We also look for a new gain in the eating/drinking segment as consumers continue to transition away from goods.”

ING

“Retail sales at the headline level will be modestly depressed (0.3%) due to falling gasoline prices weighing on gas station sales as it is a nominal dollar figure. However, this frees up cash to spend on other goods and services so the ‘core’ rate of retail sales growth should rebound and help to translate into rising real consumer spending.”

NBF

“Car dealers likely contributed positively to the headline number, as auto sales increased during the month. Gasoline station receipts, for their part, may have decreased judging from a drop in pump prices. All told, headline sales could have advanced 0.7% MoM. Spending on items other than vehicles may have been a tad weaker, rising 0.5%.”

CIBC

“Total retail sales growth appears to have weakened in July as prices at the pump eased, while building material sales likely fell further along with the cooling in housing market activity. With some offset from higher unit vehicle sales and restaurant receipts, total retail sales likely eked out a 0.2% advance. The 0.5% growth expected in the control group (ex. gasoline, building materials, autos, and restaurants) will largely reflect higher prices, with sales volumes limited by consumer resistance to higher prices and the erosion in real incomes, consistent with reports from some major retailers lately.” 

Citibank

“US July Retail Sales – Citi: 0.0%, prior: 1.1%, Retail Sales ex Auto – Citi: -0.3%, prior: 1.0%, Retail Sales ex Auto, Gas – Citi: 0.3%, prior: 0.7%, Retail Sales Control Group – Citi: 0.3%, prior: 0.8%. We expect control group retail sales to increase by 0.3% MoM due to modest increases in most categories. That said, goods demand is expected to continue waning, which is likely to be reflected in weaker retail prints in real terms in the coming months.”