Retail Spending Edged Higher in October, Building on Strong Gains Seen in September

Retail spending edged higher in October, up 0.2 percent, building on September’s strong 1.7 percent gain. Overall, these data show that consumers are accelerating their purchases after slowing down somewhat in the summer months. On a year-over-year basis, retail sales have risen 4.6 percent since October 2016, off just slightly from 4.8 percent in the previous report, which was a 6-month high.

There has been robust growth in motor vehicle and parts sales in the past two months, up 4.6 percent and 0.7 percent in September and October, respectively, with the segment benefiting from hurricane-related replacements. Excluding automobiles, retail sales were up 0.1 percent in October, with year-over-year growth of 4.3 percent.

Digging into the latest data, retail spending was higher in October at the following store segments: sporting goods and hobbies (up 1.5 percent), clothing and accessories (up 0.8 percent), food services and drinking places (up 0.8 percent), health and personal care (up 0.8 percent), electronics and appliances (up 0.7 percent), food and beverage (up 0.7 percent) and furniture and home furnishings (up 0.7 percent).

At the same time, sales were lower for building material and garden supply stores (down 1.2 percent), gasoline stations (down 1.2 percent) and nonstore retailers (down 0.3 percent). The building material figure decline followed a 3.0 percent increase in September, likely stemming from recent hurricanes; whereas, the reduction in gasoline station spending stemmed from lower petroleum prices. For instance, the average price of regular gasoline dropped from $2.679 per gallon on September 4 to $2.488 on October 30, according to the Energy Information Administration.

Over the past 12 months, the fastest growth in retail sales were in the following categories: building material and garden supply stores (up 8.8 percent), gasoline stations (up 7.5 percent), nonstore retailers (up 6.8 percent), motor vehicles and parts dealers (up 5.6 percent) and furniture and home furnishings stores (up 4.4 percent).

Chad Moutray

Chad Moutray

Chad Moutray is chief economist for the National Association of Manufacturers (NAM) and the Director of the Center for Manufacturing Research for The Manufacturing Institute, 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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