Osaka Corp - The latest sign that the US economy is failing to find its feet after a lackluster quarter has arrived in the form of worse-than-expected retail sales data.

Economists had forecast a 0.3% increase but got a 0.0% flat reading leading many to speculate that the slow pace of growth in so crucial a sector of the economy would likely see the Federal Reserve hold off tightening monetary policy and potentially choking off the recovery.

“This is bad news for the recovery but it’s fantastic news for equity markets,” said an OSC Osaka Corp analyst.

“Stocks have been jittery of late because a hike in interest rates would make stocks look less appealing to investors in comparison to fixed income assets like bonds which pay a yield. People have been wondering how much mileage is left ahead for the stock rally but this retail sales data is definitely bullish.”

Retail sales have been weak despite households receiving a boost from much lower gasoline prices because many consumers have simply decided to save the money they have saved.

“There are all sorts of reasons why consumers haven’t spent including the fact that many may still have debt to pay down but we suspect that people would rather wait for seasonal discounts,” said the OSC analyst.

OSC Osaka Corp believes there is more room for the stock rally to run because the Federal Reserve will be less inclined to raise interest rates for fear of choking off a recovery that has entered its 6th year with little or no sign of reaching what economists call “escape velocity” – a pace of growth that would enable the economy to withstand normalization of monetary policy.