U.S. retail sales snap back; high unemployment, rising COVID-19 loom over recovery
It seems to us here at PGP that, as consumers get more comfortable living in a "phase 2" kind of world, activity is really picking up. Our tenants are reporting strong traffic in their locations and we are seeing good leasing activity. Many restaurants in particular are doing quite well with mainly curbside, takeout, and delivery options. The vacation towns on the coast have been packed.
This short article on Reuters is confirming what we are seeing. Yes, there are risks around a resurgence, but we firmly believe that more mask wearing and common sense behaviors will start to slow the spread once again as we enter August and September - and perhaps we will see that slowing first in the "hot spot" states in the Southeast.
WASHINGTON (Reuters) - U.S. retail sales rose more than expected in June as consumers bought big-ticket items like motor vehicles and dined out, but a resurgence in new COVID-19 cases is chipping at the budding recovery, keeping 32 million Americans on unemployment benefits.
Retail sales rose 7.5% last month after jumping 18.2% in May, which was the biggest gain since the government started tracking the series in 1992. Economists polled by Reuters had forecast retail sales advancing 5% in June.
Retail sales have rebounded as businesses resumed operations after being shuttered in mid-March in an effort to slow the spread of the respiratory illness. Retail sales in June were driven by an 8.2% increase in receipts at auto dealerships. Consumers stepped up spending at furniture, clothing, electronics and appliance, hobby, musical instrument and book stores. Receipts at restaurants and bars shot up 20.0%.
“Activity snapped back in May and June, albeit to levels below those which prevailed prior to the pandemic,” said Michael Feroli, chief U.S. economist at JPMorgan in New York. “More recently, several high-frequency indicators suggest that May and June were the easy months, and that the resurgence of COVID-19 cases is leading to slower activity gains in July.”