U.S. retail sales gained the largest this year in July as people increased purchases of automobiles and upped discretionary spending, which implies the economy keeps gaining traction in the beginning of the third quarter.
Retail sales figures for May and June were reviewed upward as well, it could work to mollify concerns over consumer expenditure following slowdown in the beginning of the year. Yesterday’s report could push the Fed to increase interest rates in December.
Sal Guatieri of BMO Capital Markets said that U.S. consumers swarmed into shopping centers last month, which indicates people are able to drive the economy forward through the rest of the year. He added that this should subdue talks about the Fed postponing rates rise till after this year.
Retail sales shot up 0.6% in July, the biggest increase since last December. June's figures were revised to 0.3% growth, though previous report said 0.2% fall. Experts’ predictions for the July retail sales were 0.4% up.
May figures were revised to unchanged instead of 0.1% slump. In July retail sales grew by 4.2% compared to the same period of the preceding year.