The latest developments surrounding COVID-19 and its continued impact on the U.S. economy will take center stage in a busy week ahead.

<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="The May retail sales report, which will be released Tuesday morning, will peel back the curtain on the health of the U.S. consumer amid one of the worst global pandemics in modern history. The consumer is expected to have rebounded following April’s record plunge in retail sales. While COVID-19 likely put some pressure on consumer spending during May, economists predict online sales maintained their strength. Even spending in the beaten down core components are expected to have rebounded in May.” data-reactid=”17″>The May retail sales report, which will be released Tuesday morning, will peel back the curtain on the health of the U.S. consumer amid one of the worst global pandemics in modern history. The consumer is expected to have rebounded following April’s record plunge in retail sales. While COVID-19 likely put some pressure on consumer spending during May, economists predict online sales maintained their strength. Even spending in the beaten down core components are expected to have rebounded in May.

Economists surveyed by Bloomberg expect headline retail sales rose 7.4%, up from a 16.4% decline in April. Meanwhile, retail sales excluding the volatile auto and gas components likely jumped 4% in May, up from a 16.2% plunge in April.

“As many states continued to ease restrictions on resident mobility and nonessential business activity, various high-frequency estimates of consumer spending data indicated solid increases in major discretionary categories in May following historical declines in April,” Nomura economist Lewis Alexander said in a note June 12.

Alexander pointed out that, consistent with recent data from WardsAutos, sales at auto and auto parts dealerships likely rebounded double digits. However, spending at restaurants is expected to have rebounded only modestly, according to Alexander. “Although data from OpenTable, an online restaurant booking service, indicated some improvement in seated diner volume, sales at restaurants were likely weaker than the seasonal ramp-up in sales during late spring, weighing on the seasonally adjusted estimate.”

Credit Suisse economist James Sweeney argued that while retail sales in May will have rebounded from April’s sharp declines, the recovery will be gradual. “Consumer spending should start to recover in May as the country emerges from nationwide lockdown. However, the recovery will only be gradual as reopening happens in phases and consumer behavior shifts. With confidence still depressed and the labor market impaired, consumption is likely to take years to recover despite recent fiscal relief helping to support household income,” Sweeney wrote in a note to clients June 11.

Federal Reserve Board Chairman Jerome Powell testifies before the Senate Banking Committee in a hearing on the semi-annual monetary policy report to Congress on Capitol Hill in Washington, U.S., February 12, 2020. REUTERS/Yuri GripasFederal Reserve Board Chairman Jerome Powell testifies before the Senate Banking Committee in a hearing on the semi-annual monetary policy report to Congress on Capitol Hill in Washington, U.S., February 12, 2020. REUTERS/Yuri Gripas
Federal Reserve Board Chairman Jerome Powell testifies before the Senate Banking Committee in a hearing on the semi-annual monetary policy report to Congress on Capitol Hill in Washington, U.S., February 12, 2020. REUTERS/Yuri Gripas

Federal Reserve Chairman Jay Powell is scheduled to appear before the Senate Banking Committee on Tuesday and the House Financial Services Committee Wednesday for the semiannual monetary policy report to Congress. On Friday at 1 p.m. ET, Powell will be speaking during a virtual discussion on “Building a Resilient Workforce During the COVID-19 Era.”

<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="Powell’s busy week follows the Federal Open Market Committee’s (FOMC) latest interest rate decision and commentary regarding its policy path. The Committee signaled that it would not raise interest rates through at least 2022.” data-reactid=”34″>Powell’s busy week follows the Federal Open Market Committee’s (FOMC) latest interest rate decision and commentary regarding its policy path. The Committee signaled that it would not raise interest rates through at least 2022.

In the press conference following the rate decision, Powell stressed that the committee is “not even thinking about thinking about raising rates.” In a June 12 note, Capital Economics said, “Powell will reinforce the Fed’s dovish message in his semi-annual testimony to Congress.”

<h2 class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="Economic calendar” data-reactid=”36″>Economic calendar

<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="Monday: Empire Manufacturing, June (-30 expected, -48.5 prior); Net Long-term TIC Flows, April (-$112.6 billion in March); Total Net TIC Flows, April ($349.9 billion in March)” data-reactid=”37″>Monday: Empire Manufacturing, June (-30 expected, -48.5 prior); Net Long-term TIC Flows, April (-$112.6 billion in March); Total Net TIC Flows, April ($349.9 billion in March)

<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="Tuesday: Retail Sales Advance month-on-month, May (+7.4% expected, -16.4% in April); Retail Sales excluding Autos month-on-month, May (+5.5% expected, -17.2% in April); Retail Sales excluding Autos &amp; Gas month-on-month, May (+4.0% expected, -16.2% in April); Industrial Production, May (+3.0% expected, -11.2% in April); Capacity Utilization, May (66.8% expected, 64.9% in April); NAHB Housing Market Index, June (43 expected, 37 in May)” data-reactid=”38″>Tuesday: Retail Sales Advance month-on-month, May (+7.4% expected, -16.4% in April); Retail Sales excluding Autos month-on-month, May (+5.5% expected, -17.2% in April); Retail Sales excluding Autos & Gas month-on-month, May (+4.0% expected, -16.2% in April); Industrial Production, May (+3.0% expected, -11.2% in April); Capacity Utilization, May (66.8% expected, 64.9% in April); NAHB Housing Market Index, June (43 expected, 37 in May)

<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="Wednesday: MBA Mortgage Applications, week ending June 12 (9.3% prior); Building Permits, May (1.26 million expected, 1.066 million in April); Housing Starts, May (1.1 million expected, 891,000 in April)” data-reactid=”43″>Wednesday: MBA Mortgage Applications, week ending June 12 (9.3% prior); Building Permits, May (1.26 million expected, 1.066 million in April); Housing Starts, May (1.1 million expected, 891,000 in April)

<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="Thursday: Philadelphia Fed Business Outlook, June (-25.0 expected, -43.1 in May); Initial Jobless Claims, week ending June 13 (1.3 million expected, 1.542 prior); Continuing Claims, week ending June 6 (19.8 million expected, 20.93 million prior); Bloomberg Consumer Comfort, week ending June 14 (38.7 prior); Leading Index, May (2.4% expected, -4.4% in April)” data-reactid=”44″>Thursday: Philadelphia Fed Business Outlook, June (-25.0 expected, -43.1 in May); Initial Jobless Claims, week ending June 13 (1.3 million expected, 1.542 prior); Continuing Claims, week ending June 6 (19.8 million expected, 20.93 million prior); Bloomberg Consumer Comfort, week ending June 14 (38.7 prior); Leading Index, May (2.4% expected, -4.4% in April)

<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="Friday: Current Account Balance, Q1 (-$102.3 trillion expected, -$109.8 trillion prior)” data-reactid=”45″>Friday: Current Account Balance, Q1 (-$102.3 trillion expected, -$109.8 trillion prior)

<h2 class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="Earnings calendar” data-reactid=”46″>Earnings calendar

<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="Monday: N/A” data-reactid=”47″>Monday: N/A

<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="Tuesday: Lennar (LEN) before market open; Groupon (GRPN), Oracle (ORCL) after market close” data-reactid=”48″>Tuesday: Lennar (LEN) before market open; Groupon (GRPN), Oracle (ORCL) after market close

<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="Wednesday: N/A” data-reactid=”49″>Wednesday: N/A

<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="Thursday: Kroger (KR) before market open” data-reactid=”50″>Thursday: Kroger (KR) before market open

<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="Friday: CarMax (KMX)” data-reactid=”51″>Friday: CarMax (KMX)

<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="” data-reactid=”52″>

<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="Heidi Chung is a reporter at Yahoo Finance. Follow her on Twitter:&nbsp;@heidi_chung.” data-reactid=”53″>Heidi Chung is a reporter at Yahoo Finance. Follow her on Twitter: @heidi_chung.

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