Retail Sales Jump, but the Story is in the Details...

Retail sales jumped 0.9% last month on the back of higher gasoline prices and increased automobile purchases. Automobile sales were mostly catalyzed by bigger incentives to clear inventories. But, factoring out these components retail sales would have actually declined for the 4th consecutive month. Therefore, despite what appears to be a significant increment on the surface, the details behind this morning's data do not yet indicate a recovery for the sector. Finally, consumers' purchases were centered around basic necessities such as food and gas versus discretionary goods.

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