Canadian retail sales for May missed expectations but still registered growth, rising 0.3%. Analysts had forecast a 0.5% increase. Autos fell well short of expectations and along with gasoline were a significant counter-weight to clothing, general merchandise and food. Retail sales volume was up 0.7%.
Bond yields are up slightly despite more evidence Spain is heading toward a full blown, government bailout. The country has asked for a 28 billion euro line of credit to cover debts coming due in October. Spain can’t afford to raise money in the financial markets. Yields on its government bonds have sailed beyond 7% this week. Yield on Spain’s 10-year hit 7.56% today.
Adding to the European angst, Moody’s has lowered its outlook for Germany to negative from stable. The agency cites exposure to European debt. That has peeved the German public and could make it tougher to turn to Berlin for more bailout money. The Netherlands and Luxembourg also had their outlooks downgraded.
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