US May Retail Sales Rise 0.9% MoM, Consumer Resilience Stronger Than Expected

Tradingkey - On Wednesday, Eastern Time, data released by the U.S. Census Bureau showed that U.S. retail sales in May increased by 0.9% month-on-month, significantly higher than the market expectation of 0.5%; retail and food services sales in May reached $763.7 billion, up 6.9% year-on-year. Meanwhile, the retail sales growth from March to April was revised down from the previously reported 0.5% to 0.4%.

By category, U.S. retail trade sales in May rose 1.0% month-on-month and 7.5% year-on-year, indicating that goods consumption remains resilient. Non-store retailer sales grew 12.2% year-on-year, continuing to be a key driver of U.S. consumption growth, while sales at food services and drinking places increased 2.7% year-on-year, showing that services consumption continues to expand moderately.

Performance of May retail sales data: U.S. consumer spending has not cooled significantly despite high interest rates and inflationary pressures, and the consumer side continues to support the economy. At the same time, the stronger-than-expected retail data may also reinforce market expectations that the Federal Reserve will maintain a tight policy stance. However, because this data is not adjusted for inflation, part of the growth may be driven by rising commodity and energy prices; therefore, the market still needs to combine real consumption volume, inflation, and employment data to further assess the true momentum of the U.S. economy.