US Retail Sales Preview: Forecasts from eight major banks, unit vehicle sales drive the advance

The US Census Bureau will release the April Retail Sales report on Tuesday, May 16 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 in the US are expected to rise by 0.7% month-on-month vs. a revised -0.6% (was -1.0%) in March. Meanwhile, sales ex-autos are expected at 0.4% MoM vs. a revised -0.4% (was -0.8%) in March.  The so-called control group used for GDP calculations is expected at 0.3% MoM vs. -0.3% in March. 

Commerzbank

“Retail sales figures for April will now provide the first indications of whether consumers are starting to run out of steam after all. However, we are more likely to expect a decent increase again. We forecast a 0.7% increase in retail sales. However, part of the increase reflects the rise in the price of gasoline, which inflates nominal sales at gas stations.”

TDS

“We expect retail sales to rebound by a strong 1.0% MoM in April following March's 0.6% MoM drop. Auto sales will likely be a key driver as well as sales in gas stations. Importantly, control group sales likely recovered after two consecutive retreats in Feb-Mar, as online sales appear to have held up. We also look for sales in bars/restaurants to expand at a brisk pace.”

RBC Economics

“We expect the US retail sales to tick up 0.5% in April, driven by an increase in unit auto sales.”

NBF

“Car dealers likely contributed strongly to the headline number, as auto sales jumped during the month. An increase in gasoline station receipts is also likely to have taken place, reflecting higher pump prices. All told, headline sales could have advanced 1.5%. Spending on items other than vehicles could have expanded too, albeit at a slower pace.”

CIBC

“Consumers were cautious to open their wallets to retailers at the end of the first quarter, but a jump in unit vehicle sales in April suggests that the second quarter could have started on more solid footing, with retail sales likely increasing by an impressive 0.9%. Higher gasoline prices could have also helped the nominal headline gain. In the control group, which excludes autos, gasoline, restaurants, and building materials, and feeds more directly into non-auto goods consumption in GDP, sales could have increased by a healthy 0.3%, reflecting strength in wages and job growth. We are a bit above consensus which could be modestly bearish for bonds.” 

Wells Fargo

“For April, we expect retail sales to rise 1.0%, while retail sales ex-autos rose 0.5%. Separately reported auto sales data suggest another strong month for sales, and incomes are more broadly on track to keep spending sustainable, at least in the short term, due to the historically strong labor market.”

Deutsche Bank

“We expect the headline to print at +0.7% in April, up from -0.6% previously, or +0.5% vs -0.4% ex autos. Headline will likely be boosted by strong auto sales in the month. The gain in ex-autos sales is likely to be gas price related and we expect a flat reading on retail control (unch. vs. -0.3%), which is the direct input into GDP for goods spending. So consumption is likely grinding lower after a strong start to the year.”

Citi

“We expect a solid 0.8% MoM increase in total retail sales in April and excluding auto and gas, expect a more modest 0.3% MoM gain. Control group retail sales should also increase by a more modest 0.5% MoM. April retail sales would be consistent with real goods spending increasing more modestly as demand remains muted near term.”