Retail Sales Were Soft in August, up Modestly Over the Past Year

Retail spending was down 0.2 percent in August, according to the Census Bureau, and it is likely that Hurricane Harvey might have negatively impacted those figures. Weather aside, retail sales have continued to increase modestly overall, helping to provide a boost to the U.S. economy. Along those lines, Americans had been more willing to open their pocketbooks more this year than last, especially than in the beginning months of 2016. Over the past 12 months, spending has risen by 3.2 percent. Still, there has been a bit more caution on the part of the American consumer in the past few months than we might have expected. The year-over-year rate has drifted lower since peaking at 5.6 percent in January, for instance. Excluding motor vehicles, retail sales increased 3.6 percent year-over-year in August, up from 2.4 percent in June but down from 5.4 percent in January.

Looking at the August report, the data were mixed. Businesses with increased sales for the month included gasoline stations (up 2.5 percent), miscellaneous store retailers (up 1.4 percent), furniture and related furnishings (up 0.4 percent) and food and beverage stores (up 0.3 percent), among others. The increase in gasoline station sales likely came from higher prices. Indeed, the average price of West Texas intermediate crude oil rose from $46.63 in July to $48.04 in August. In contrast, there was reduced spending seen the following segments: motor vehicles and parts (down 1.6 percent), nonstore retailers (down 1.1 percent), clothing and accessories (down 1.0 percent), electronics and appliances (down 0.7 percent) and building materials and garden supplies (down 0.5 percent).

Since August 2016, the largest gains in retail spending were for nonstore retailers (up 8.4 percent), building material and garden supply stores (up 7.5 percent), gasoline stations (up 6.4 percent), furniture and home furnishings stores (up 5.4 percent) and miscellaneous store retailers (up 5.2 percent).

Chad Moutray

Chad Moutray

Chad Moutray is chief economist for the National Association of Manufacturers (NAM), where he serves as the NAM’s economic forecaster and spokesperson on economic issues. He frequently comments on current economic conditions for manufacturers through professional presentations and media interviews. He has appeared on Bloomberg, CNBC, C-SPAN, Fox Business and Fox News, among other news outlets.
Chad Moutray

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