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Weekly economic review & outlook Post-lockdown spike in spending

June 22, 2020

You Need to Know

Week in review

Retail sales soar in May as economies reopen

The 17.7 percent jump in retail sales was by far the biggest gain ever as pent-up demand from the COVID-19 lockdown spurred spending.

Housing starts up but even more gains are likely coming soon

Home construction edged higher for May but a surge in permits and more optimism from home builders suggest larger increases ahead.

Week Ahead


Existing home sales down, but new sales up for May

Based on another drop in pending home sales, existing sales should decline again for May; but rising purchase applications and a pickup in the NAHB housing market index suggest that new sales should rise further.

Personal consumption expenditures should rebound strongly

Based on a record gain in retail sales, personal consumption expenditures should jump for May after two months of large declines.

The comeback in retail sales for May was much larger than expected as total sales jumped by 17.7 percent — a record by a considerable margin. While an already reported rise in light vehicles sales provided a significant boost, retail sales excluding autos rose by 12.4 percent (also a record gain), reflective of a surge in purchases across all major categories. May’s increase was not enough to offset the massive declines seen in the prior two months but is still a significant step on the road to recovery for consumer activity.