US retail sales unchanged in June, beating forecasts for slight drop

foxbusiness.com:

Ironsides Macroeconomics Managing Partner Barry Knapp discusses the 'era of financialization' on the 'Unbreakable Investor' town hall on 'Making Money.'

U.S. retail sales were unchanged in June and the underlying trend was strong, which could boost economic growth estimates for the second quarter.

The flat reading in retail sales last month followed an upwardly revised 0.3% gain in May, the Commerce Department's Census Bureau said on Tuesday.

Economists polled by Reuters had forecast retail sales, which are mostly goods and are not adjusted for inflation, falling 0.3% after a previously reported 0.1% gain in May.

INFLATION UNEXPECTEDLY FALLS TO 3% IN JUNE

A woman shops for household items at a retail store in Rosemead, California, on Jan. 19, 2024.  ((Photo by FREDERIC J. BROWN/AFP via Getty Images) / Getty Images)

Still, the outlook for sales is unfavorable.

Households are becoming more price sensitive and focusing on basic needs, evident in earnings reports from major retailers and manufacturers.

WHERE ARE HIGH PRICES STILL HITTING AMERICANS THE HARDEST?

PepsiCo CEO Ramon Laguarta said last week lower-income consumers were «stretched» and «strategizing a lot to make their budgets get to the end of the month.»

PepsiCo CEO Ramon Laguarta gestures as he speaks during a panel session on day three of the World Economic Forum (WEF) in Davos, Switzerland, on Thursday, Jan. 24, 2019. (Jason Alden/Bloomberg via Getty Images / Getty Images)

Most households have run down the excess savings accumulated during the COVID-19 pandemic and are carrying a lot of credit card debt, which is becoming more expensive as interest rates remain elevated. Wage growth is also moderating as the labor market cools. Nonetheless, the pace of