New York – According to locally based Moody’s Investors Service, the latest news on retail sales suggests the quarter-to-quarter annualized growth rate of real consumer spending will drop from Q1 2001’s 2.9% to 1.6% for the second quarter. In addition, the quarter-to-quarter annualized growth of real GDP might dip from Q1 2001’s 1.3% to an expected 0.5% for the second quarter.

Rising unemployment may dampen any near-term re-acceleration of retail sales. However, lower interest rates, lower taxes and tax rebates should supply valuable support to consumer spending by the final quarter.