Cortera’s COVID-19 Economic Impact Tracker: June Business Spending Showed Slight Improvement from May
June retail sales should be strong from a pickup in spending before new virus outbreak slowed activity
Retail sales in June are expected to have gained 5.2% as the economy reopened, but sales could have trailed off towards the end of the month as the virus outbreak worsened.
According to Dow Jones, economists expect sales rose 5% when excluding vehicle sales. May sales jumped by a surprising 17.4%, and 17.2% excluding automobiles, as states first reopened their economies.
“They’re backward looking, and I’m afraid we might get a decline in July,” said Diane Swonk, chief economist at Grant Thornton. She expects sales increased by 5.5%, and the number would have been stronger were it not for a slowdown by consumers who stayed home in the second half of the month.
“That was before states went into reversing lock downs. Foot traffic in malls declined,” she said. Some states have moved to once more restrict indoor dining, bars and movie theaters, after opening up several weeks ago.
Mark Zandi, chief economist at Moody’s Analytics, said he expects sales increased by 6%, and he said business spending data collected by software firm Cortera confirms that it was strong. Cortera analyzes business to business spending, and it is a barometer for spending activity by consumers.
“The strongest categories were a big increase in clothing stores, furniture, electronics and appliance stores and sporting goods stores,” he said.
However, he said in hot-spot states, spending clearly slowed toward the end of the month, as there were fewer restaurant bookings.