Luis Hidalgo
Economists polled by Reuters had expected an increase of 1.0 percent – after a solid increase in sales from an upwardly revised 10.7 percent in March.
Citizens’ consumer appetite was also spurred that month by US President Joe Biden’s trillion dollar pandemic aid package, which included, among other things, one-time checks totaling $ 1,400 for millions of Americans.
Economist Dirk Chlench from the Landesbank Baden-Württemberg refers to the classification that US retail sales stagnated in April at “their high level of the previous month”. In his opinion, the economic indicators published in the past few weeks contain a message: “If there is any doubt, there will be less growth, but more inflation than previously thought.”
The recovery on the US labor market, for example, surprisingly slowed down in April. Only 266,000 jobs were created outside of agriculture and thus far fewer than expected. At the same time, a surprisingly large rise in consumer prices of 4.2 percent has sparked fears that inflation could get out of hand.
The US Federal Reserve supports the economy hit by the Corona crisis with monthly cash injections of 120 billion dollars. It intends to hold on to it until substantial progress has been made on the way to price stability and full employment. She sees rising inflation as a temporary phenomenon that currently does not require a change of course in monetary policy, which will probably remain geared towards low interest rates for years to come.