US DATA: Non-Seasonally Adjusted Initial Claims Hit 4-Year Low In Solid Report

• MNI:US MAY FHFA HPI SA +0.3% V -0.1% APR; +2.2% Y/Y

Retail sales continued to rise robustly through most of July but look to have slowed from the summer's multi-year peak rates, per the latest Johnson Redbook index. The report showed 8.3% Y/Y sales gains in the week ending Jul 25 (7.8% in the week prior), bringing the month-to-date total to 8.1% (little changed from 8.0% prior).

• June's 10.1% Y/Y looks clearly to have been the high water mark for sales at brick-and-mortar retailers as measured by Redbook (which says it covers 80% of Census Bureau retail sales). Total Census retail sales rose 7.3% in May and 6.7% in July. Those recent peaks for both Census and Redbook correspond to the highest growth since Aug/Sep 2022 (the timing of the Redbook calendar periods means that the months are not directly comparable).
• The slowdown looks at least in part disinflation-related but we've seen similar dynamics in other proxy series including BofA ex-gas card spending which has faded to around 3% Y/Y growth through mid-July vs 6-7% a few weeks earlier.
• From the Redbook anecdotals: "In the most recent period, retailers have been working to clear out summer inventories and bring in back-to-school merchandise. Some have seen slow sales and less interest from shoppers, which is typical for mid-July. The onset of back-to-school sales tax holidays in Florida has been drawing in shoppers to buy more for less on selected books, school supplies, computers, and clothing, along with some non-exempt products. To boost back-to-school sales, retailers are investing more in branded content, videos, social media, and influencer marketing. By mid-August, back-to-school shopping is expected to give all sectors a boost."

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