US: July Retail Sales and Industrial Production consistent with steady growth – Nomura

Analysts at Nomura note that the US July core (“control group”) retail sales rose 0.5% m-o-m, slightly stronger than expectations (Nomura and Consensus: 0.4%).

Key Quotes

“Core retail sales in June, however, were revised down to a 0.1% decline from no change (note that core retail sales are used for estimating personal consumption of GDP).”

“Overall, the report suggests continued momentum in personal spending in Q3 after a transitory slowdown in end-Q2. We continue to expect solid consumer spending data this year in light of personal tax cuts now fully in effect and firm consumer fundamentals.”

“Excluding autos, retail sales rose 0.6% (Nomura: 0.5%, Consensus: 0.3%). Aggregate retail sales increased 0.5% m-o-m (Nomura: 0.2%, Consensus: 0.1%).”

“Industrial production increases less than expected but remains healthy

Industrial production for July increased modestly by 0.1% m-o-m, below expectations (Nomura: 0.2%, Consensus: 0.3%), after a 1.0% gain in June. Ex-auto manufacturing output rose at a moderate but steady pace of 0.2% after a 0.3% gain. While slightly slower than the previous month, ex-auto manufacturing output growth appears steady nonetheless.”