US Retail Sales Fizzle Despite Rebate Checks

The jubilation over the strong US retail sales figures for May was short lived as it wa reported yesterday that sales for the month of June rose a tepid 0.1%. Not only that, the original estimate for May was revised lower by 0.4%. From the Census Bureau:

ADVANCE MONTHLY SALES FOR RETAIL TRADE AND FOOD SERVICES
JUNE 2008
The U.S. Census Bureau announced today that advance estimates of U.S. retail and food services sales for June, adjusted for seasonal variation and holiday and trading-day differences, but not for price changes, were $384.2 billion, an increase of 0.1 percent from the previous month and 3.0 percent above June 2007. Total sales for the April through June 2008 period were up 2.6 percent from the same period a year ago. The April to May 2008 percent change was revised from +1.0 percent to +0.8 percent.

Retail trade sales were up 0.1 percent from May 2008 and were 3.0 percent above last year. Gasoline station sales were up 24.5 percent from June 2007 and sales of nonstore retailers were up 8.1 percent from last year.

It's worth noting that gasoline sales were up a huge $2 billion or 24.5% in the month of June, obviously reflecting higher prices. Auto sales dropped to levels not seen for at least 2 years. It will be interesting to see the state of retail sales when the rebate checks are gone. I doubt they will be impressive.