Thursday, August 09, 2007

Retailers: Disappointing July

by Bill McBride on 8/09/2007 10:49:00 AM

From MarketWatch: Consumers spent less as economic worries weighed

Retailers struggled ... in July as shoppers spent less while they grappled with economic anxieties and volatility that has rocked financial markets.

With nearly all of the nation's major retailers reporting sales results to the International Council of Shopping Centers, the cumulative gain stands at 2.6%, according to Thursday's data.

... the early results suggest that consumers across the board are far more concerned about credit and financing woes sparked by the slowdown in the U.S. housing market and the collapse of the subprime mortgage business.

"I had thought that we'd have a number that was better than this," said ICSC chief economist Mike Niemira. "Certainly the macroeconomic slowdown that we've seen since last summer has taken its toll on consumer spending -- directly through the housing channel and indirectly through the home-value concerns."
This is our first look at July retail sales. Following the sharp slowdown in the growth of Personal Consumption Expenditures (PCE) in Q2 - that many analysts blamed on gasoline prices - it will be interesting to see if consumer spending is slow in Q3 too.

The Census Bureau is scheduled to release the July advance monthly retail sales on Monday, August 13th.