Retail Sales Surge, Defying Expectations

James Hyerczyk
Updated: Apr 15, 2024, 14:24 GMT+00:00

Key Points:

  • Consumer spending resilient despite rising inflation pressures.
  • Notable growth in online and miscellaneous retail categories.
  • New York State manufacturing continues to contract in April.
  • Significant decline in new orders and shipments.
  • Weakness in labor market, subdued optimism about future conditions.
US Retail Sales

Retail Sales Surge, Outpacing Expectations

Retail sales surged by 0.7% in March, defying expectations and indicating robust consumer spending despite rising inflation pressures. The Commerce Department’s report on Monday revealed a significant increase, surpassing the Dow Jones consensus forecast of a 0.3% rise.

Retail Sales Report Facts

Consumer Resilience: Despite a 0.4% increase in the consumer price index, consumers maintained a rapid pace of spending, outpacing inflation at a 3.5% annual rate.

Category Performance: Excluding auto-related sales, retail sales jumped 1.1%, with notable growth in online sales (2.7%) and miscellaneous retailers (2.1%).

Market Reaction: Stock market futures rose after the report, reflecting optimism, despite escalated tensions in the Middle East.

Empire State Manufacturing Survey: Continued Contraction

Manufacturing activity in New York State continued to contract in April, according to the Empire State Manufacturing Survey. The general business conditions index rose slightly but remained below zero at -14.3, indicating ongoing challenges for manufacturers.

Persistent Decline: New orders and shipments declined significantly, with unfilled orders continuing to shrink.

Labor Market Weakness: Employment and hours worked declined, while optimism about future business conditions remained subdued.

Market Forecast: Cautious Optimism

Despite challenges in the manufacturing sector and geopolitical tensions, the strong retail sales data suggests resilience in consumer spending. However, ongoing inflationary pressures and uncertainties warrant cautious optimism. Traders should monitor upcoming economic indicators for insights into market trends.

About the Author

James is a Florida-based technical analyst, market researcher, educator and trader with 35+ years of experience. He is an expert in the area of patterns, price and time analysis as it applies to futures, Forex, and stocks.

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