Bloomberg News

U.S. Retail Sales Probably Slowed on Jobs

May 15, 2012

Retail sales in the U.S. probably slowed in April as the unseasonably mild weather and pre-Easter shopping that pulled consumers to stores and malls the prior month wore off, economists said before a report today.

The 0.2 percent gain in sales would follow a 0.8 percent March increase and mark the weakest advance in four months, according to the median forecast of 80 economists surveyed by Bloomberg News. Another report may show little change in the cost of living last month.

Sales at building material, clothing and furniture stores probably deteriorated in April compared with a weather-induced gain in the first three months of 2012, the warmest on record. Weaker employment growth may also make it more difficult for households to match the pace of spending last quarter, which was the fastest in more than a year.

“An early Easter and better weather in the prior months probably pulled some growth forward, so the underlying trend for consumers is better than the April number should portend,” said Russell Price, senior economist at Ameriprise Financial Inc. in Detroit. Price was the third-best forecaster of retail sales in the two years ended in March, according to data compiled by Bloomberg. “Consumers need to see their financial prospects on firmer footing, and that primarily means they need stronger employment growth.”

The Commerce Department’s figures are due at 8:30 a.m. in Washington. Economists’ estimates ranged from a decline of 0.3 percent to a gain of 0.7 percent.

Retailers’ same-store sales trailed analysts’ estimates in April for the first time since November, industry data show. Sales at Target Corp., the second-biggest U.S. discount chain, rose 1.1 percent, below the 2.9 percent projection.

Warmer Weather

Part of that slowdown may reflect seasonal events that pulled sales into the previous month. The average temperature in March was the warmest on record in the U.S., and Easter fell on April 8 compared with April 24 the year before.

The retail sales category used to calculate gross domestic product, which excludes sales at auto dealers, building material stores and service stations, will show a 0.3 percent gain in April, after a 0.4 percent rise in the prior month, according to economists surveyed.

Last quarter, consumer spending, which accounts for 70 percent of the economy, grew at a 2.9 percent annual rate, the most since the fourth quarter of 2010, according to data from the Commerce Department.

Sustaining that pace of purchasing, nonetheless, may be more difficult with weaker job growth. Employers took on 115,000 workers last month, the fewest since October, a Labor Department report showed May 4. The jobless rate also declined as people left the work force.

Dining Out

“The consumer environment has been and continues to be tough,” G. Price Cooper, chief financial officer of restaurant chain Texas Roadhouse Inc. (TXRH:US), said during a May 9 investor conference. “It has been that way for a couple of years. Fortunately, I guess from the industry perspective, we’ve seen a pretty decent trend in sales over the last year.”

Less expensive fuel will free up some of consumers’ cash for other goods and services. The average price of a gallon of regular gasoline fell to $3.73 on May 13 from a peak this year of $3.94 in early April, according to AAA, the nation’s largest auto club.

The decline in fuel costs is also showing up in measures of inflation. The consumer-price index, due at 8:30 a.m., was unchanged in April after climbing 0.3 percent the prior month, according to the survey median before a Labor Department report May 15. Prices rose 2.3 percent over the past year, down from 2.7 percent in March.

Also today, an 8:30 a.m. report from the Federal Reserve Bank of New York is projected to show manufacturing in that region picked up in May. A 10 a.m. report from the Commerce Department may show inventories increased 0.4 percent in March, according to the Bloomberg survey median.

                       Bloomberg Survey

================================================================
                               CPI     Core   Retail   Retail
                                        CPI    Sales ex-autos
                              MOM%     MOM%     MOM%     MOM%
================================================================
Date of Release              05/15    05/15    05/15    05/15
Observation Period           April    April    April    April
----------------------------------------------------------------
Median                        0.0%     0.2%     0.1%     0.2%
Average                       0.0%     0.2%     0.1%     0.1%
High Forecast                 0.3%     0.2%     0.7%     0.8%
Low Forecast                 -0.1%     0.0%    -0.3%    -0.4%
Number of Participants          80       78       80       74
Previous                      0.3%     0.2%     0.8%     0.8%
----------------------------------------------------------------
4CAST                        -0.1%     0.2%    -0.2%    -0.1%
ABN Amro                      0.1%     0.2%     0.2%     ---
Action Economics              0.2%     0.2%     0.3%     0.2%
Aletti Gestielle              0.1%     0.2%     0.2%     0.3%
Ameriprise Financial          0.1%     0.2%     0.1%     0.2%
Banca Aletti                  0.1%     0.2%     0.0%     0.6%
Bantleon Bank AG              0.0%     0.2%     0.1%     0.1%
Barclays                      0.0%     0.2%     0.2%     0.2%
Bayerische Landesbank         0.2%     0.2%     0.1%     0.1%
BBVA                          0.1%     0.2%     0.3%     0.2%
BMO Capital Markets           0.1%     0.2%     0.2%     0.1%
BNP Paribas                   0.0%     0.2%    -0.3%    -0.3%
BofA Merrill Lynch           -0.1%     0.2%     0.1%    -0.1%
Briefing.com                  0.0%     0.2%     0.2%     0.2%
Capital Economics             0.1%     0.2%     0.3%     0.3%
CIBC World Markets            0.0%     0.2%     0.4%     0.3%
Citi                          0.0%     0.2%     0.0%     0.1%
ClearView Economics           0.1%     0.2%     0.1%     0.3%
Comerica                      0.1%     0.2%     0.2%     0.2%
Commerzbank AG                0.1%     0.2%     0.0%    -0.1%
Credit Agricole CIB           0.0%     0.2%     0.2%     0.2%
Credit Suisse                 0.0%     0.2%    -0.1%    -0.2%
Daiwa Securities America      0.1%     0.2%     0.1%     0.1%
Danske Bank                   0.0%     0.2%     0.1%     ---
DekaBank                      0.0%     0.1%    -0.1%    -0.2%
Desjardins Group              0.0%     0.2%     0.3%     0.3%
Deutsche Bank Securities      0.1%     0.2%     0.2%     0.3%
Deutsche Postbank AG          0.2%     0.2%     0.3%     0.3%
DZ Bank                       0.2%     0.2%     0.1%     0.2%
Exane                         0.0%     0.2%     0.1%     0.0%
Fact & Opinion Economics      0.1%     0.2%     0.2%     0.3%
First Trust Advisors          0.1%     0.2%     0.2%     0.5%
FTN Financial                -0.1%     0.2%     0.1%     0.0%
Goldman, Sachs & Co.          0.1%     0.2%    -0.1%    -0.1%
Helaba                        0.0%     0.2%     0.3%     0.2%
High Frequency Economics      0.0%     0.2%    -0.2%    -0.2%
HSBC Markets                 -0.1%     0.2%    -0.2%     0.3%
Hugh Johnson Advisors         0.3%     0.2%     0.4%     0.3%
IDEAglobal                    0.1%     0.2%     0.6%     0.4%
IHS Global Insight           -0.1%     0.2%    -0.2%    -0.2%
Informa Global Markets        0.2%     0.2%     0.0%     0.1%
ING Financial Markets         0.1%     0.2%     0.4%     0.3%
Insight Economics             0.0%     0.2%     0.1%     0.3%
Intesa Sanpaulo               0.0%     0.2%    -0.2%    -0.1%
J.P. Morgan Chase             0.0%     0.2%     0.0%     0.0%
Janney Montgomery Scott      -0.1%     0.1%     0.3%     0.4%
Jefferies & Co.               0.1%     0.2%     0.2%     0.4%
Landesbank Berlin             0.3%     0.1%     0.3%     0.2%
Landesbank BW                 0.0%     0.1%     0.2%     ---
Maria Fiorini Ramirez         0.0%     0.2%     0.2%     0.2%
Market Securities             0.0%     0.2%    -0.2%     ---
MET Capital Advisors          0.2%     ---      0.5%     ---
Mizuho Securities             0.0%     0.1%     0.1%     0.2%
Moody’s Analytics             0.0%     0.2%     0.1%     0.0%
Morgan Stanley & Co.          0.0%     0.2%     0.0%    -0.2%
National Bank Financial       0.0%     0.2%     0.1%     0.0%
Natixis                       0.1%     0.2%     0.4%     0.2%
Nomura Securities            -0.1%     0.1%    -0.2%    -0.3%
Nord/LB                       0.1%     0.2%     0.3%     0.3%
OSK Group/DMG                 0.0%     0.2%    -0.2%    -0.3%
O’Sullivan                    0.0%     0.2%    -0.1%    -0.1%
Parthenon Group               0.0%     0.2%    -0.3%    -0.4%
Pierpont Securities           0.0%     0.2%     0.0%    -0.1%
PNC Bank                      0.1%     0.2%    -0.1%     0.0%
Raymond James                 0.0%     0.2%     0.5%     0.4%
RBC Capital Markets          -0.1%     0.2%    -0.2%    -0.1%
RBS Securities                0.0%     0.2%     0.0%     0.0%
Scotiabank                    0.0%     ---      0.1%     0.1%
SMBC Nikko Securities         0.0%     0.2%     0.7%     0.8%
Societe Generale             -0.1%     0.0%    -0.2%    -0.2%
Standard Chartered            0.1%     0.2%     0.4%     0.2%
Stone & McCarthy Research     0.1%     0.2%     0.1%     0.1%
TD Securities                 0.1%     0.1%     0.3%     0.3%
UBS                          -0.1%     0.2%     0.0%     0.0%
UniCredit Research            0.0%     0.2%     0.2%     ---
University of Maryland        0.0%     0.2%     0.3%     0.2%
Wells Fargo & Co.             0.0%     0.2%     0.2%     0.3%
WestLB AG                     0.1%     0.2%     0.2%     0.2%
Westpac Banking Co.           0.0%     0.1%    -0.3%     0.2%
Wrightson ICAP               -0.1%     0.2%     0.0%     0.0%
================================================================

To contact the reporter on this story: Alex Kowalski in Washington at akowalski13@bloomberg.net

To contact the editor responsible for this story: Christopher Wellisz at cwellisz@bloomberg.net


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Companies Mentioned

  • TXRH
    (Texas Roadhouse Inc)
    • $25.36 USD
    • -0.10
    • -0.39%
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