US consumers returned with a vengeance in April pushing advance retail sales up by 1.3% compared with the same month in 2015. The number was far better than expected, soundly beating consensus forecasts for a 0.8% increase. Last month’s reading of a 0.4% decline was revised slightly upwards to a 0.3% decrease.

Stripping out automobiles, gasoline, building materials and food services, core retail sales jumped by 0.9% following an upwardly revised 0.2% last month. The data was a welcome boost for a sector which has struggled with lackluster demand and supported assertions that economic growth was gaining traction after slowing to a 0.5% annualized rate in the first quarter of 2016.

Many economists had feared the worst after retailers like Macy’s, Nordstrom and Gap reported poor earnings in the first quarter but increasing sales at online retailers like Amazon showed that consumers were simply changing their shopping habits.

Hardeep Sandhu, chief economist at Tokyo-based investment house, Shinsei Corporate Management sounded a note of caution. “One swallow does not a summer make,” he said. “This is definitely a strong number but I don’t think anyone will be putting a June rate hike firmly back on the table because of it. Let’s not forget the big miss on nonfarm payrolls in April and poor numbers coming in from other parts of the economy.”

Shinsei Corporate Management is generally bearish on the US economy and expects it to flirt closely with recession in 2016.

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