April Retail Sales

In April retail sales continued to expand faster than expected according to the Commerce Department, rising for the seventh consecutive month.  The 0.4% increase was double consensus expectations and positive 0.2% revisions were added to February and March as well.  This result is even more impressive given the shift of normally robust Easter related sales out of April by a quirk of the calendar.  If we adjust for this by combining March and April, then averaging the results, we still come up with results that are both quite strong and very encouraging.  Increasing sales of building materials at hardware stores and garden centers, one of the strongest components of this month’s report, may be pointing to an increasing confidence by home owners in the long-term viability of their residence, possibly the single largest asset they own.  Retail sales have now grown in twelve of the last thirteen months and are up 8.8% year-over-year.  This also suggests to us a continued rise in both consumer sentiment and confidence figures are in the cards.  All this good news compels us to raise this indicator’s needle another notch.