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U.S. May Jewelry Store Sales Decline 4% to $3B

Jul 14, 2015 12:56 PM   By Jeff Miller
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RAPAPORT... U.S. specialty jewelry store sales fell 4.4 percent year on  year to $2.703 billion in May, according to the latest government calculations. The decline was noticeable considering that preliminary sales of jewelry and watches  across all channels during the month was basically flat at $7.1 billion.

Specialty jewelry store sales in the first five months of the year have fallen 4.6 percent to $11.201 billion. However, jewelry and watch sales across all channels have declined only 0.6 percent year on year to $28.7 billion, according to preliminary Rapaport News estimates.

Advanced sales estimates at U.S. department stores, meanwhile, fell 3 percent year on year to $12.6 billion in June.  Total retail sales, excluding motor vehicle and parts, rose 1.1 percent to $349.3 billion. Retail trade sales rose 0.6 percent and nonstore retail sales increased 7 percent to $37.3 billion.

While advanced retail sales data for June improved  from one year ago, overall, the figures were lower on a month-to-month basis, disappointing Wall Street analysts. "The underlying tone of this report suggests that the recovery is beginning to show some signs of strain. If anything it will temper, at the margin, any consideration for a September rate hike,"  Millan Mulraine, the deputy chief economist at TD Securities, told Reuters.

Lindsey Piegza, the chief economist at Stifel, wrote in a note to clients that Wall Street's prediction of a consumer spending splurge in the the third quarter has come under fire.  "Not only did June spending drop back into negative territory, but much of the strength in previous months was lessened, reestablishing the clear declining trend in consumption," she said.

Spending weakness in June was widespread, too, so there was little evidence to suggest that consumers would be more willing to open their wallets further in the second half of the year, according to Stifel. 

"From the Fed's point of view, expectations of a 2014-style rebound, following the general malaise of the first quarter, are clearly unfounded as the consumer continues to pull back, business investment continues to trend negative and U.S. manufacturing remains under pressure from a strong dollar and tepid international demand," she said.

The National Retail Federation (NRF) concluded that June's retail sales data left "more questions than answers" about the health of consumer spending. However, NRF’s chief economist, Jack Kleinhenz, remained optimistic and steadfast that consumers will indeed find the appetite to spend more in the months ahead. "While the weaker than expected report doesn’t match with current trends, there’s no reason to believe this is a continuing problem," he said.

“While consumer spending continues to be erratic and varied, going forward I expect to see improvements in retail sales, supported mostly by the U.S.’s healthy labor market, improving housing markets and easier access to consumer credit,” he noted.

Strong year-on-year sales gains were observed for furniture and home furnishings, sporting goods and clothing and accessories stores in June, the NRF stated.

 

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Tags: consumer, Jeff Miller, Jewelry, retail sales, spending, stores, watches
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