Live on Bloomberg TV

00:00Good morning John. Well it looks like Americans are still spending if not a little bit less than they had been anticipated to spend with retail sales on a month over month basis up nine tenths of a percent. That's stronger than the month of March which had been revised already up to seven tenths. It's a little bit less than the 1 percent that was anticipated by economists. The retail sales ex auto is up six tenths. That is half roughly what it was in March. And retail sales without auto and gas up 1 percent. And that's important because gasoline and food have especially been taking a bigger part of American's budget. You take a look at grocery stores. They were down a tenth of a percent during the month of April. And gasoline stations were down actually down two point seven percent. So that's interesting because we had thought gasoline prices had started to go up again. But since they probably held about steady during the month the percentage change isn't as much. But here's an interesting thing. On a year over year basis gasoline sales are up thirty six point nine percent. So you can see an inflation impact there. A couple of other numbers to point out here. Electronics and appliance stores up 1 percent after a decline of 5.2 percent. Maybe that's a little bit of a rebound in what people are buying out of housing. The clothing and clothing accessories up eight tenths of a percent non store retailers. This is the group that includes Amazon. Tom was talking about Amazon two point one percent higher. That is a bigger change than the prior month which was just zero point four percent. And food services and drinking places which is the one we always talk about in honor of Tom up 2 percent horse after one point nine percent the month before. So that little extra he had at the hotel the other day contributing as a way of eating and doing his best for the American working for the American economy. Equities up nicely here at one point three percent coming into the print coming out of it. So if you to see a movie sort of front end of the yield curve to a year to High Flyers basis points. I think we can round that one up now and call it nine basis points higher at 666 on a two year since me. Trading off the back of some the export IBEX gas number which was an upside surprise the control group an upside surprise and some really decent revisions across the board. The revisions to mirror. Here's to you. I look at this like on a three month moving basis. So the revisions really matter to me. And John what's important here on the celebration of the two year yield taken a breather. We're halfway back to the 280 level 266 to year. That's the question. Might you take the data. What does it mean for the Fed. The heat still on right. The heat still on. It does suggest that we are going to see ongoing strength in the U.S. economy which is what the Fed wants to see. Jim Bullard the St. Louis Fed president just out with some headlines. He's speaking this morning. One of six different feds are using including the chairman. I'm not speaking today but while I am speaking right now and Bullard saying the he expects that household spending will hold up because of the strong job market he thinks that the tighter Fed policy is already having an effect. And I think he's there talking about the the housing sector. And he does not expect recession in U.S. or Europe even though he said that Europe and China are risk factors for the United States right now. Mike before we let you go we've been talking all morning about how good news may be becoming bad news for the Fed that basically these numbers coming in strong and frankly the upward revision from a negative to a very decidedly positive level for the prior month in the core group. And the comparison control group really gives the Fed more incentive to hike further. How much pressure does this really put on them to make the 50 basis point moves and then follow it up with additional ones later in the year. Well since they've already said they would do 50 at the next two meetings it probably doesn't add a lot to them. What they'll want to see is where they are in July with retail sales. Once we get through the next two months the May and June numbers before the July meeting and then we'll see where they go when they get to September because at this point we know the economy is strong. It's a question of when does that additional weakness we've seen in housing because of higher mortgage rates bleed over into the rest of the economy. Jim Bullard suggesting it's not going to a whole lot but we'll have to see.

No schedule data available.

Retail Sales Rise in April Despite Record Inflation

US retail sales grew at a solid pace in April, reflecting broad-based gains and suggesting demand for merchandise remains resilient despite rampant inflation. Bloomberg's Mike McKee reports on "Bloomberg Surveillance." (Source: Bloomberg)

More From Bloomberg Surveillance
All episodes and clips

Bloomberg Technology
The only daily news program focused exclusively on technology, innovation and the future of business from San Francisco. Hosted by Emily Chang.
More episodes and clips