Retail sales in the U.S. rose by much less than expected in the month of June, according to a report released by the Commerce Department on Tuesday, although the report also showed upward revisions to the sales growth in the two previous months.
The Commerce Department said retail sales edged up by 0.2 percent in June compared to economist estimates for an increase of about 0.6 percent.
While the sale growth came in well below estimates, the report also showed that retail sales rose by an upwardly revised 0.5 percent and 0.6 percent in May and April, respectively.
The weaker than expected sales growth in June was partly due to a drop in auto sales, which fell by 0.3 percent after climbing by 0.8 percent in the previous month.
Excluding the drop in auto sales, retail sales rose by 0.4 percent in June, matching the revised increase seen in the previous month. Ex-auto sales had been expected to increase by 0.5 percent.
The report also showed that sales by building materials and supplies dealers pulled back by 1.0 percent in June after rising by 0.6 percent in May.
On the other hand, sales by general merchandise stores jumped by 1.1 percent in June after edging down by 0.1 percent in the previous month.
Notable sales growth was also shown by health and personal care stores, clothing and accessories stores, and non-store retailers.
Closely watched core retail sales, which exclude autos, gasoline, and building materials, increased by a solid 0.6 percent in June after inching up by 0.2 percent in May.
Christoph Balz, an economist at Commerzbank, said, "Don't be misguided by the weak 0.2% increase in U.S. retail sales in June. The offsetting good news is that sales in April and in May rose stronger than previously reported."
"Moreover, even the June figures are more encouraging than they appeared to be at first sight as sales rose by a solid 0.6% in the core business," he added. "All in all, the steady recovery in the labor market increases consumers' willingness and power to spend."
The Commerce Department noted that total retail sales in the month of June were up by 4.3 percent compared to the same month a year ago.
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