US retail sales likely to have dropped in June on strong decline in motor vehicle sales

Retail sales in the US are expected to have declined in the month of June, owing to the sharp fall in auto sales. Last month, auto sales declined 4.4 percent to 16.6 million, the second-weakest figure since February 2015.

The fall in auto sales is expected to have impacted auto dealers’ receipts that might have declined about 3.1 percent. Given the decline in motor vehicle sales, it might have weighed heavily on retail sales, which is expected to have dropped 0.4 percent in June, noted Societe Generale in a research report.

However, excluding autos, the scenario could possibly be brighter and might be similar to May’s retail sales data. Excluding auto series, retail sales might have grown 0.3 percent again, whereas the figure excluding gasoline and autos is likely to have risen 0.4 percent, according to Societe Generale.

The control group is expected to have grown 0.5 percent that might leave it a huge 6.9 percent annualized above the first quarter data. This would make it the best performance since the second quarter of 2014 and highlighting the strong recovery in spending in the second quarter. Real spending in the second quarter is expected to have risen by just over 4 percent annualized, said Societe Generale.