- The PPI Ex Food & Energy for May rose .3% versus estimates of a .2% gain and a .1% rise in April.
- Advance Retail Sales for May rose .1% versus estimates of a .1% gain and a .8% rise in April.
- Retail Sales Less Autos for May rose .5% versus estimates of a .5% increase and a .8% rise in April.
- Business Inventories for April rose .4% versus estimates of a .6% increase and a .7% gain in March.
BOTTOM LINE: Prices paid to US producers rose less than expected in May, Bloomberg reported. Computer prices fell .6% last month versus a 3.7% decline the prior month. Food prices fell .5% after a .1% gain a month earlier. I continue to believe inflation fears have peaked for this cycle.
Sales at US retailers rose at the slowest pace in three months in May as soaring gas prices cut spending on other goods, further evidence the economy is cooling, Bloomberg said. Stores selling building materials and garden supplies showed a .4% drop in sales last month versus a 2.1% fall in April. Purchases from auto dealers fell 1.6% in May versus a .8% increase in April. I continue to believe retail sales are in the process of slowing to more average rates.
Business inventories in the US rose less than expected in April, held back by a decline in stockpiles at retailers, Bloomberg said. Sales rose .6% versus a .9% gain the prior month. At the current sales pace, companies had enough goods on hand to last 1.26 months, near the record low of 1.25 months in January. Inventories will likely stabilize around current levels before companies begin rebuilding later in the year as confidence improves in the sustainability of the current expansion.
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