U.S. Retail Sales Rise 0.2% In June, Much Less Than Expected

(RTTNews) - A report released by the Commerce Department on Tuesday showed retail sales in the U.S. increased by much less than expected in the month of June.

The Commerce Department said retail sales edged up by 0.2 percent in June after climbing by an upwardly revised 0.5 percent in May.

Economists had expected retail sales to advance by 0.5 percent compared to the 0.3 percent growth originally reported for the previous month.

Excluding a modest increase in sales by motor vehicles and parts dealers, retail sales still rose by 0.2 percent in June after rising by an upwardly revised 0.3 percent in May.

Economists had expected ex-auto sales to increase by 0.3 percent compared to the 0.1 percent uptick originally reported for the previous month.

The report showed significant increases in sales by miscellaneous store retailers, non-store retailers, furniture and home furnishing stores and electronics and appliance stores.

However, the growth was partly offset by notable decreases in sales by department stores, gas stations, building material and supplies dealers and sporting goods, hobby, musical instrument and book stores.

Closely watched core retail sales, which exclude automobiles, gasoline, building materials and food services, advanced by 0.6 percent in June after rising by 0.3 percent in May.

"While headline June retail sales came in a bit softer than forecast, the upward revision to May and the strength in core retail control sales (excludes autos, building materials and gas) shows the consumer spending remained healthy as Q2 winded down," said Nationwide Chief Economist Kathy Bostjancic.

She added, "The continued sturdy retail sales figures support another rate hike by the Fed on July 26, however it will be the upcoming reports that indicate whether vibrant spending continued into Q3 and whether it support further rate hikes beyond next week."