There was a somewhat disappointing release from the Commerce Department yesterday, reporting that retail sales rose by a very modest 0.2 percent in June. On the heels of the news that GDP growth in the first quarter had declined by 2.9 percent, that might make it look like our economy was showing severe weakness.
That's not the case, though. The June retail number isn't the only figure the report revealed; Commerce also revised upward the retail figures for April and May, to 0.6 percent and 0.5 percent growth, respectively. Those are pretty strong numbers.
On top of that, those numbers also make June's figure look better. Remember, these are month-over-month changes, so an 0.2 percent increase from a strong month looks better than a 0.2 percent increase from a bad one. All together, these retail figures make it look more and more like the first quarter GDP contraction was a onetime fluke rather than a harbinger of more bad news to come.
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