US DATA: Initial Claims At Lowest Four-Week Average Since 2022

Retail sales continued to accelerate through the end of June and into early July, per the Johnson Redbook index. They rose 11.5% Y/Y (10.5% prior) in the week to July 4 (June is a 5-week month on the retail calendar), bringing the month-to-date figure to 10.1% Y/Y (was 9.7% through the prior week). While below the 10.6% targeted by retailers, it's easily the strongest month for sales since September 2022. Redbook's preliminary target for July sales is 9.6%.

• There's no doubt that higher inflation is contributing to nominal gains, something we have seen in the official Census Bureau series, but either way nominal sales appear to have picked up steam through mid-year. We get the preliminary Chicago Fed CARTS ex-autos retail sales estimate this Thursday to help refine core estimates; early consensus for the June Census Bureau release (Jul 16) is for 0.3% M/M headline gains (0.9% prior) with ex-auto -0.1% (+0.8% prior) and Control Group 0.4% (0.7% prior).
• We also note potential for the World Cup to have boosted sales, particularly in food services, with BofA noticing in its credit/debit card spending data that "brick-and-mortar spending at restaurants and bars was up 5.3% y/y in the host cities, vs. 3.8% in the rest of the US...Since the BAC card data only cover US-based households, the "World Cup effect" is likely much larger than the data suggest."
• From the Johnson Redbook anecdotes: "Significant nationwide temperature increases, combined with Independence Day promotions, led to increased demand for summer merchandise and brought more shoppers into air-conditioned stores. This year, retailers are launching back-to-school promotions earlier than usual. Many people also stocked up on groceries in preparation for the long holiday weekend. Looking ahead, July is a four-week month which ends on August 1st and typically experiences relatively low sales volume, with promotions driving sales as stores clear out summer inventories and restock for fall."

• MNI: US REDBOOK: STORE SALES +11.5% WK ENDED JUL 04 VS YR AGO WK
• US REDBOOK: JUL STORE SALES +10.1% VS YR AGO MO

• ADP private employment increased an average 21k in the four weeks to Jun 20.
• It's the softest reading since mid-March as the weekly tracker continued to slowly moderate after some particularly strong ~40k increases in late March/early April and then again in early May.
• This is a monthly equivalent of 84k vs the 97k in the previous week (chiming with the 98k in the May monthly report and its reference period including the 12th day of the month) and 123k in early June.
• As we have often noted this year, the ADP series, at least prior to any major revisions, have shown a smoother jobs growth trajectory than the noisier BLS series since late 2025.
• For now, the ADP series sees a further recent moderation in jobs growth although it still compares favorably to the 33k monthly jobs growth averaged through 2025.