Retail Sales Up Slightly In June
Economists Cautiously Optimistic For 3rd Quarter
U.S. retail sales increased 0.4% in June, lifted by demand for automobiles and higher gas prices, government data showed. Core sales, which strip out automobiles, gasoline and building materials and correspond most closely with the consumer spending component of GDP, edged up 0.1%. Business inventories, meanwhile, rose 0.1% in May after a 0.2% gain in April, an indication that restocking could be less of a boost to GDP in the second quarter, analysts say.
A separate report this week showed factory activity in New York state accelerating in July, bolstering the view of economists that growth is likely to pick up soon. The New York Fed's Empire State general business conditions index rose to 9.46 this month, up from 7.84 in June. A reading above zero indicates expansion in the region's closely-watched factory activity.
Economists remain cautiously optimistic for the third quarter given the steady improvement in employment, which is starting to generate growth in income. Data shows particular areas of strength in the economy for distributors to capitalize on include the housing sector, as well as the automotive and hospitality industries.