A new batch of weak data has now come from the US retail sales. Over July, sales fell by 0.7%, more than the -0.2% expected. This data develops the idea that Americans have chosen to stay away from retail markets with overheated prices in recent months, except fuel. Americans have gotten out of the house and have been making fewer home improvements, as seen in the historic record fuel sales contrasted with the fifth month of falling home improvement and home improvement sales.
That said, despite weaker-than-expected data, retail sales are well above long-term trend levels thanks to the continued fiscal stimulus from the government and the previously accumulated cash cushion from government cheques.
A dip in consumer sentiment could point to an even steeper fall in sales in August unless Americans’ assessment of the condition changes thanks to improving the coronavirus situation.