August 15, 2013
Retail sales advanced at a tepid pace in July as consumers maintained a cautiously optimistic stance in the face of mixed economic news. Limited risk tolerance and fragile psyches remain a hallmark of the recession, reiterating that a transition to a consumer-led recovery may still be slow in forming. The positively performing but still-soft retail market will likely weigh on the Fed’s timing as they consider decreasing their infusions into the capital markets. Speculation that tapering will soon begin has already pressured Treasury rates, increasing the 10-year by more than 100 basis points over the last two months. These trends temporarily unnerved the mortgage and auto markets, but rising home values and the strengthening employment market will offset these forces as the “wealth effect” gathers momentum and begins lifting consumption through the remainder of this year.
Total retail sales advanced 0.2 percent in July as auto dealers…
View original post 375 more words