US Retail Sales Preview: Forecasts from eight major banks, a decent gain

The US Census Bureau will release the April Retail Sales report on Tuesday, May 17 at 12:30 GMT and as we get closer to the release time, here are the forecasts of economists and researchers of eight major banks regarding the upcoming data. 

Retail Sales are forecast to climb 0.7% in April, up from 0.5% in March. Sales ex-Autos are expected to rise 0.3% after adding 1.1% in March and the Control Group is projected to increase 0.7% in April following a gain of 0.5% in March.

Commerzbank

“Retail sales are likely to have risen by 0.8% in April from March even as the decline in the price of gasoline depressed sales by half a percentage point. In contrast, we expect a strong increase in new car purchases based on data from auto manufacturers. Overall, such an increase in retail sales would be encouraging, as the days when consumers mainly bought goods and consumed fewer services (of which only restaurant sales are included in retail sales) because of the pandemic are now over. Instead, the consumption profile is slowly returning to normal, for example, because consumers are traveling more frequently again.”

TDS

“We look for retail sales to advance firmly in April (1.5%), continuing with the monthly gains registered so far this year. Spending was likely aided by a strong rebound in auto purchases and an increase in control group sales. We also look for a 1%+ MoM gain in the eating/drinking segment (i.e. bars & restaurants) as consumers continue to transition away from goods spending.”

SocGen

“We look for a 0.6% MoM gain in retail spending for April and above the inflation pace of 0.3% reported last week. We include a meaningful bounce in auto sales for April. New sales of autos and light trucks rose to a 14.3 mu pace in April from 13.4 in March. Outside of autos, retail sales are expected to be flat. The gains on autos are important, as these sales are typically very sensitive to the business cycle.”

NBF

“Car dealers likely contributed positively to the headline number, as auto sales improved during the month. Gasoline station receipts, for their part, may have retraced a bit judging from a decrease in pump prices. All told, headline sales could have advanced 0.9% MoM. Spending on items other than vehicles may have been a tad weaker, rising 0.6%.” 

Deutsche Bank

“We are anticipating a +1.7% print, up from +0.7% in March. Rebounding auto sales should help the headline number.”

CIBC

“Higher unit sales of vehicles in the US in April will boost total retail sales, more than offsetting the drop in prices at the pump. Combined with an improvement in restaurant traffic, total retailing likely advanced by a respectable 1.1% on the month. However, sales likely won’t look as rosy in other categories as the squeeze on consumer spending power from higher prices likely resulted in a more modest 0.4% advance in the control group of sales (ex. autos, gasoline, restaurants, and building materials), which implies only slight growth in volume terms. That would still leave sales well above where the pre-pandemic trendline would have put them in both nominal and real terms. We are slightly more pessimistic than the consensus on the control group which could see bond yields and the USD ease off.”

Citibank

“US April retail Sales – Citi: 0.6%, prior: 0.7%, Retail Sales ex Auto – Citi: 0.1%, prior: 1.4%, Retail Sales ex Auto, Gas – Citi: 0.4%, prior: 0.7%, Retail Sales Control Group – Citi: 0.4%, prior: 0.7%.  We see a solid increase in topline retail sales for April with data showing a still active consumer but one that is shifting preferences away from goods towards services.”

Wells Fargo

”We expect retail sales rose 0.6% in April, but when adjusted for inflation, we estimate real retail sales expanded 0.9%.”