US Retail Sales Rise, Consumers Remain Resilient
US retail sales rose in May, signaling that consumer demand remains strong despite rising gasoline prices due to the Iran war. This data shows that household consumption remains a mainstay of the economy amidst energy pressures.
The US Census Bureau reported that retail purchases rose 0.9% in May, after increasing 0.4% in April based on an upward revision. This figure is not adjusted for inflation, so some of the increase still reflects the impact of higher prices.
The main increase came from gas station receipts, which rose 3.4% as gasoline prices rose in May. However, outside gas stations, sales still rose 0.7%, indicating that demand is still spread across other sectors.
For the Federal Reserve, this data could reinforce the case for remaining cautious in signaling policy easing. Solid consumption, if coupled with energy inflation, could keep price pressures longer-lasting.
The market's next focus will be on the details of consumer spending, the direction of energy prices, and the Fed's response to the combination of strong demand and persistently high inflation. As long as consumption remains resilient, the room for US policy easing is potentially limited. (gn)*
Source: Newsmaker.id
