U.S. Retail Sales Rebounded Last Month

Dow Jones
09/16

Sales growth at U.S. retailers rose in August, rebounding from its decrease in July, the Commerce Department said.

Retailers' sales rose by 1.2% last month to $773.9 billion, versus the 0.5% decrease recorded in July. August's reading was higher than the 0.8% increase economists polled by The Wall Street Journal expected.

Retail sales numbers are recorded in nominal terms and account for the total number of dollars spent. In August, Americans were still paying high prices for gasoline.

Outside of gasoline stations, however, sales showed some consumer strength.

Sales in the so-called "control-group" categories that feed into the formula for gross domestic product-rose rose by about 1.4%.

Meanwhile, sales at nonstore retailers rose by 2.6%. Spending in other discretionary categories, such as electronics and appliance stores rose by 1.6%.

Some analysts forecasted that August's retail sales were due to rebound after July's lower than expected retail sales were attributed to Prime Day and related promotions shifting from July to June this year.

Data from Bank of America showed that total credit and debit card spending per household rose 0.9% month-over-month in August on a seasonally adjusted basis, following a 0.2% decline in July.

A positive reading of retail sales paired with August's better-than-expected jobs report should reassure economists that growth was more solid than July's figures suggested.

"This reaffirms that the economy is more than capable of handling higher interest rates, providing the Fed plenty of scope to hike to get inflation under control," wrote Bradley Saunders, North America economist at Capital Economics.

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