Retail sales disappoint ... again

Retail sales fell for the second straight month indicating a sustained rebound in consumer spending may be difficult to accomplish amid steady job losses and a higher savings rate.
After a decline of 1.3 percent in March, overall retail sales tumbled 0.4 percent in April, well below analysts' estimates of a 0.1 percent gain.

On a year-over-year basis, retail sales are now down 10.1 percent and a full two-thirds of the January-February rebound that followed six straight months of declines in the second half of last year have now been reversed.

Excluding motor vehicles, retail sales declined 0.5 percent following a decline of 1.2 percent the month before and, from year ago levels, retail sales ex-autos were down 7.7 percent.

Declines in April were widespread, paced by a 2.8 percent plunge at electronics/appliance stores and a 2.3 percent drop in gasoline station sales. Automobile sales actually posted a modest gain in April, up 0.2 percent, but are more than 20 percent lower than a year ago.

Reports of falling home values and record rates of foreclosure will likely make consumers even more cautious in the period ahead, souring views toward real estate and homeownership evident in sales at furniture and home furnishings stores as shown below. Note that these sales have posted only two monthly advances since late-2007.
After volatile sales volume at gasoline stations and automobile dealers that were 36.4 percent and 23.1 percent lower than a year ago, respectively, furniture stores saw the steepest sales declines from this time last year, down 14.1 percent.