Retail sales drop record 16.4% in April

Retail sales drop record 16.4% in April

U.S. retail sales suffered a second straight month of record declines in April as the novel coronavirus pandemic kept Americans at home.

As Fred Katayama reports, it puts the U.S. economy on track for its biggest second quarter contraction since the Great Depression.

America's retailers got clobbered in April.

Retail sales dropped a record 16.4% last month as people stayed home amid lockdowns and many got laid off.

That was much deeper than economists had expected.

Hardest hit: the apparel retail industry, whose sales nose-dived nearly 90% from last year.

Sales at furniture and electronics stores slid more than 60%.

Restaurants and bars saw their sales nearly halved.

But grocery stores sales mushroomed 13% as people cooked at home.

The dismal data puts the U.S. economy on track for its biggest second quarter contraction since the Great Depression.

Consumer spending is the main driver of the U.S. economy, accounting for two thirds of activity.

In the first quarter, personal spending tumbled at a 7.6% annualized rate.

In May, many states and local governments began reopening their economies and easing travel restrictions.

But businesses are operating well below capacity, and fears of a second wave of infections could keep consumers from visiting malls.

And earlier this week, Federal Reserve Chair Jerome Powell warned of an "extended period" of weak growth and stagnant incomes.