US May retail sales consistent with a rebound in Q2 - Wells Fargo

According to analysts from Wells Fargo, the recent retail sales report is consistent with a rebound in second quarter GDP and consumer spending.

Key Quotes:

“Retail sales were up a solid 0.5 percent in May with moderate gains in control sales. Meanwhile, non-store retailers’ sales are up 16 percent year over year and continue to outpace overall sales in this expansion.”

"Overall retail sales continue to show forward momentum during the current cycle although at a slightly slower pace than the prior expansion.”

“Today’s report is consistent with the rebound in second quarter GDP and consumer spending. Our current outlook is for a gain in consumer spending of 3.9 percent in the second quarter and 2.8 percent in 2016 compared to a gain of 3.1 percent in 2015. As a result, growth is slower in 2016 but still firmly positive.”

“Despite all the talk about economic weakness, the pace of consumer sales is actually doing ok and, in fact, the pace of growth of overall retail sales in 2016 has slightly exceeded that of 2015.”