June Retail Snails

As the country eases into the lazy hazy crazy days of summer, we are continuing to get the last details of spring’s economy.  The Census Bureau’s most recent retail sales data has slowed to a pace much like that produced by the contraction and extension mechanism a snail uses to motor across surfaces.  After growing 0.2 percent in April and contracting 0.1 percent in May, retail sales managed to extend 0.1 percent in June.  This creeping pace does not buttress your Atlas crew’s confidence in our economy’s strength.

There was some movement in automobile sales as they were up 0.8 percent after falling 1.8 percent in May.  If the month’s auto sales (which are notoriously volatile) are taken out, the statistic stops moving altogether month-over-month, remaining unchanged, and this is after a paltry pace of plus 0.2 percent in May.  Consumers did manage to spend less on gasoline even as the price went down, so removing petrol along with autos reveals other retail spending actually increased marginally by 0.2 percent.

This is one of those statistics which moves with the economy and is not able to tell us much about the future.  But looking back at it can give us a reference point for where the economy has come from and thus some sense of continuing momentum (or lack thereof).  Doing so shows major slowing in retail sales since the last quarter of 2010 when their average annualized growth rate was 3.87 percent.  It fell to 3.6 percent in the first quarter of 2011 and only managed .27 percent in the second.  The temperatures may be heating up, but retail spending has retracted into its shell.