By James Langton
(September 14 – 11:45 ET) – A
report of hotter-than-anticipated
U.S. retail sales in August has
Canadian economists calling for a
U.S. rate hike before the end of
the year.
Nesbitt Burns Inc. chief
economist Sherry Cooper says the
report forecasts too much growth
for the U.S. Federal Reserve Board.
She warns of a higher-than-expected
Consumer Price Index report in the
U.S. tomorrow on the heels of this
report.
CIBC World Markets Inc.
economist Avery Shenfeld is looking
beyond the October Fed meeting.
Shenfeld warns that the Fed could
hike rates in November. Continued
forecasts of such heady growth and
a strong U.S. jobs report in
October could spur the hike.
The very fact that economists
are already on the twit about the
November Fed meeting is ominous.
It suggests there won’t likely be
much relief from Fed obsession any
time soon.
On the upside, Shenfeld says
the Treasury selloff in response
to the number was moderate. The
silver lining will be in retail
stocks, which obviously have good
sales to report.
Economists had called for a
0.7% rise in retail sales and the
number came in at 1.2%. It’s 0.7%
ex autos. Cooper says that while
autos and gas accounted for a big
part of the jump, “there are no
signs of softening in the other
major categories.” Clothing sales
rebounded, indicating a strong
underlying spending trend.
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