US: Focus today will turn to the state of the consumer – Danske Bank

Research Team at Danske Bank, suggests that the focus today will turn to the state of the US consumer as private consumption continues to be the main growth engine in the US.

Key Quotes

“Although we think the US economy also risks disappointing in H2 16 due to contagion effects from Brexit uncertainties, we think US consumers will be relatively unaffected. It is mainly through continued weak non-residential investments that the US economy could take a hit from Brexit. However, any contagion effects are yet to be seen.

The most important data release today is the retail sales report for July where we estimate the control group (the component that feeds into GDP) grew 0.3% m/m. If we are right, private consumption growth got off to a great start in Q3 after a very strong Q2.

The preliminary consumer sentiment index from the University of Michigan for August is also due. We expect it to stay around its current level at 90, which is relatively high, suggesting that US consumers are still optimistic.”