National chain store sales fell 1.1% in the first four weeks of June versus the previous month, according to Redbook Research's latest indicator of national retail sales released Tuesday.
The drop in the index compared with a targeted 0.8% drop.
The Johnson Redbook Index also showed seasonally adjusted sales in the four week period rose 1.6% compared with June 2006 and relative to a 1.9% targeted gain.
Redbook said on an unadjusted basis, sales in the week ended June 30 were up 1.2% from the same week in 2006, after a 1.4% increase the previous week. June is a five-week month on the fiscal calendar, ending Saturday, July 7.
Later in the report there is a comment that warm weather pulled people out to summer activities. Earlier this year, cold weather was the reason given for low retail sales figures.
However, according to the BEA, chained personal consumption expenditure increases for March, April and May were -.1, .2 and .1, respectively.
A slower pace of consumer spending also jibes with today's auto sales figures:
Overall, the total industry sales rate looked to come in at about 16.1 million vehicles, lagging Thomson First Call estimates of about 16.5 million. There was one extra selling day in June 2007 than a year earlier.
"As we look at the results coming in, the performance is capping off a second quarter for the industry that I think can best be described as a bit underperforming," Paul Ballew, GM's top sales analyst, said in a conference call. "We're dealing with the twofold impact of gas prices and the housing correction that is occurring in a couple of key states."
A slowdown in consumer spending also jibes with the chained disposable income figures from the BEA. For March, April and May, disposable income figures increased .3 -.6 and -.1 respectively. These figures bring the low unemployment rate into question as well.
