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There is no wind in US retail sales.
An unexpected and dramatic pullback by shoppers cut retail sales in the US in June for the third straight month — the first time that has happened since recession-ravaged 2008.
The 0.5 percent June swoon — on the heels of a 0.2 percent May decline — is being caused by a persistently stagnant and disappointing jobs market, economists said.
With retail sales supplying 70 percent of the gas that runs the US economy, Wall Street number- crunchers moved quickly yesterday to trim their forecasts for second-quarter gross domestic product.
“However hard you look, there’s just no good news in this report,” said chief economist Paul Ashworth at Capital Economics.
Jay Feldman, an economist at Credit Suisse, cut his second-quarter GDP forecast to 1.6 percent from 2.0 percent.
Economist Michael Feroli at JP Morgan Chase, reduced his growth estimate for the second quarter to 1.4 percent from 1.7 percent. He also slashed his third-quarter outlook to 1.5 percent from an earlier 2 percent rate.
The slowdown by wary consumers is a stark reversal of their optimistic spending gains of 3.8 percent in June a year ago.
Even the big 22 percent jump in June auto sales couldn’t turn overall sales positive, according to the Commerce Dept. report.
Some investors believe the unexpectedly poor performance by US consumers could prod Federal Reserve Chairman Ben Bernanke to speed up any stimulus plan under review.
The Fed has a policy meeting at the end of the month.
In June’s retail bust, sales were up in only a handful of the 27 monthly categories counted by the government.
They rose 0.5 percent in nonstore retailing, such as online shopping, and inched up 0.1 percent at grocery stores.
Excluded in June’s report was consumer spending on services, such as doctors’ visits, travel, rent and utilities.
They’ll be released in coming weeks.