US retail sales smash expectations to surge above pre-pandemic levels
Retail sales in the US surged unexpectedly last month, providing further evidence that the American economy is roaring back to life after Covid.
Sales were 18 per cent higher annually in June and are now above pre-pandemic levels, primarily driven by a sharp uptick in spending in the hospitality industry.
Read more: US inflation surges at fastest pace in over a decade
Sales restaurant and bars shot up 40.2 per cent compared to June 2020, while sales at home goods stores gained 3.6 per cent.
The resurgence in consumer spending is being driven by the rapid rollout of the US vaccination programme and generous fiscal stimulus measures.
The build on a string of data released this week that is feeding positive sentiment toward US economy.
US jobless claims hit a pandemic low of 360,000, according to data released by the US Labour Department on Thursday.
Over the month, US retail sales increased 0.6 per cent. Economists polled by Reuters expected sales to drop 0.4 per cent.
Strong consumer spending is stoking concern that inflation may spiral out of control soon. Figures released this week showed US inflation reached its highest level since August 2008.
Fed Chair Jay Powell moved to temper inflationary concerns triggered off the back of the figures this week, reiterating that the central bank is prepared to step in if price rises become unwieldy.
Read more: Powell: US inflation likely to run hot in coming months