Retail sales jump as consumers met with higher prices
Retail sales rose 0.6% in June
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Consumer spending accelerated last month while the U.S. economy continued to gain momentum as COVID-19 restrictions were lifted and shoppers were met with higher prices.
Retail sales, a measure of spending at restaurants, stores and online, in June rose 0.6% to $621.3 billion, according to the Commerce Department. Analysts surveyed by Refinitiv had expected a decrease of 0.4%. The reading was 18% above year-ago levels.
Last month’s reading was revised down to -1.7% from the initial reading of -1.3%.
Retail sales had been slowing since the 10.7% increase in March as the impact from stimulus checks had begun to dissipate.
"Enthusiasm to get out and spend is very high," said Natalie Kotlyar, retail and consumer products industry national leader at consultancy firm BDO. "But so are prices, as retailers face significant supply and labor shortages."
Retailers, restaurants and bars continued to see strong growth.
Sales at clothing and clothing accessory stores soared 2.6% versus last month and 47.1% from a year ago. Food services and drinking places saw sales rise 2.3% in June and 40.2% year over year.
Meanwhile, sales slumped at motor vehicle and parts dealers and furniture stores as the industries continued to grapple with supply-chain dislocations and higher prices.
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Sales in June dipped 2% at auto dealers as prices spiked 10.5% from the prior month. Sales were still up 19.5% from a year ago.
Furniture sales slid 3.6% month over month, but were up 17.1% annually.
Excluding autos, retail sales in June rose 1.3%, outpacing the 0.4% increase that was expected.