Based on BofA's almost omniscient analysts, traders should expect a big disappointment this morning from US retail sales as the bank's data showed a huge drop in online retail (card not present) in July...
...because Prime Day and related promotions were pulled forward from July to June this year. Many other retail categories also saw m/m declines, including clothing, gas (due to lower prices) and furniture. Other factors driving the weakness in July likely included the heat wave around July 4 weekend and a modest post-World-Cup hangover effect.
And once again, BofA was right... US Retail Sales plunged 0.6% MoM in July (+0.1% MoM exp) - the biggest MoM drop since May 2025. This drop slowed the annual rise in retail sales to +5.0% YoY (still solid)...
Interestingly, unadjusted retail sales rose in July...
Both headline and core sales growth slowed YoY...
Most importantly, the 'Control Group' - which plugs directly into GDP calculation - dropped 0.4% MoM (dramatically worse than the +0.3% MoM rise expected)
