US Retail Sales Decline More Than Expected in May; Fed Meeting Looms

May Retail Sales Drop

• 📉 Retail sales in the US fell by 0.9% in May, exceeding the 0.6% forecast by economists.
• ⚠️ This marks the second consecutive month of decline, following a 0.1% decrease in April.
• 🚗 The significant drop is largely attributed to auto sales, which fell sharply after a March spike related to anticipated tariffs.

Underlying Economic Stability

• 💡 Excluding auto sales, retail sales were down 0.3%, still below expectations but indicating a less severe trend.
• 📈 Other economic indicators show steadiness, including an increase in consumer sentiment in June and stable wage growth and unemployment rates.
• 🌍 Geopolitical tensions and their potential impact on oil prices are creating consumer uncertainty, making future consumer behavior difficult to predict.

Federal Reserve Interest Rate Outlook

• 📊 The market anticipates a near 0% chance of an interest rate cut at the upcoming Federal Reserve meeting.
• 🎯 Focus is on the Fed's guidance for the remainder of the year, with expectations shifting from two rate cuts to potentially just one.
• 📈 Jerome Powell has described the current period as one of