U.S. retail sales beat expectations in May, gold price ticks down

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(Kitco News) The gold market edged down after retail sales beat market expectations in May.

U.S. retail sales rose 0.3% last month following an increase of 0.4% in April, according to the latest data from the U.S. Commerce Department. Economists' consensus calls projected a decrease of 0.1% in May’s headline number.

Core sales, which strip out vehicle sales, were up 0.1% last month, in line with market expectations. The report’s control group, which strips out autos, gas, building materials, and food services, beat market expectations, advancing 0.2% versus the projected 0%.

Economists were not impressed with the data, projecting a slowdown in consumer purchases to continue.

“The motor vehicle surprise largely explains why retail sales handily beat the consensus forecast for a 0.3% m/m decline,” said Capital Economics chief North America economist Paul Ashworth. “Overall, this fits with our view that the lagged impact of higher interest rates will continue to weigh more heavily on households, generating what could now be an extended period of weak consumption growth.”

Gold ticked down but was largely unchanged following the retail sales data, with August Comex gold futures last trading at $1,942.40, down 1.35% on the day. Prior to the release, gold was already down as investors digested a hawkish pause by the Federal Reserve.