Ahead Of The Bell: Retail Sales

The Fed survey is consistent with observations from Fed Chairman Ben Bernanke and other central bank officials that the recession — which started in December 2007 and is now the longest since World War II — is loosening its grip on the economy.

Many analysts predict the economy is sinking at a pace of between 1 and 3 percent in the current quarter. If they are right, that would mark a big moderation from the steep declines seen since last fall. The economy shrank at a pace of 6.3 percent in the final quarter of last year, and by 5.7 percent in the first three months of this year. It marked the worst six-month performance in 50 years.

The improvement in consumer confidence hasn't been fully reflected yet at the cash register, with job worries and falling home prices still weighing on Americans as they shop. Many U.S. retailers posted disappointing sales in May, according to industry data released last week. Food and other necessities remained high on shoppers' lists.

The tally by Goldman Sachs and the International Council of Shopping Centers showed that overall same-store sales fell 4.6 percent, worse than the 3 percent drop predicted. Sales at stores open for at least a year are considered a key barometer of retail health.