United States: Retail sales bounce back in October
November 15, 2019
Nominal retail sales rose 0.3% month-on- month in seasonally-adjusted terms in October, in contrast to the 0.3% fall registered in September. The increase came in just above market analysts’ predictions of a 0.2% expansion, and marked a swift return to growth following last month’s unexpected dip. The reading means retail sales have expanded in 8 of the past 10 months, highlighting resilient consumer spending even as weaknesses manifest elsewhere in the economy.
Retail sales excluding automobiles, gasoline, building materials and food services—also known as core retail sales as they most closely reflect private consumption in the GDP readings—grew 0.3% on a month-on-month basis in October, up from the flat reading posted in September.
The increase in spending belied mixed fortunes across business categories. Sales in motor vehicles and parts—usually a very volatile category—increased, while sales at gasoline stations rose robustly due to high prices at the pump during the month. Brick-and-mortar stores and non-store retail sales, which include online shopping, also grew in the month. Conversely, discretionary spending appeared to weaken in the month as sales at building material suppliers, furniture stores and clothing and accessories all fell in October, which could suggest more modest holiday spending this year.
In annual terms, retail sales growth slowed to 3.1% in October from 4.1% in September. Meanwhile, annual average retail sales growth dropped slightly to 3.2% in October, down from 3.4% in the prior month.
Author: Stephen Vogado, Economist