US Retail sales have disappointed the consensus view for four months in a row, giving the April reading (Wednesday, 08:30 ET) particular importance. A fifth disappointment is expected as the headline dropping 0.2% m/m, below the consensus of 0.2% m/m, after 0.9% in March. This drop was likely driven by decreased car sales and an unfavourable seasonal effect for gasoline prices. The core reading (ex-gas and cars) also likely on the soft side, at 0.2% m/m (below consensus of 0.6%) from 0.5% in March, judging by uneven chain-store sales data. The timing of Easter negatively affected April data, and that May sales will pick up. “Retail sales data may affect expectations for Q2 GDP growth, which we see at 3.0% q/q SAAR, although risks to this forecast are to the downside”, says Standard Chartered.
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