Consumers Consuming, Producers Producing & Treasury Borrowing

May's retail sales, including food services, rose just 0.1% m/m, weaker than expected (chart). That's in current dollars. Adjusted for inflation, they were not as weak. CPI goods fell 0.1% m/m during May. So real retail sales, less food services, rose 0.3%. Much of the recent weakness in retail sales has been in housing-related merchandise since housing sales remain weak.

Real retail sales has stalled in recent months, but remains on its pre-pandemic uptrend (chart). Nevertheless, the Atlanta Fed's GDPNow tracking model currently shows real consumer spending (on both goods and services) rising 2.5% (saar) during Q2, down slightly from the previous estimate of 2.8%. The model is tracking Q2's real GDP at 3.1%.