The Census Bureau said that retail sales were unchanged in July. Since declining due to winter weather in December and January, retail spending had rebounded in the spring months, but it has since slowed significantly. Over the course of the past 12 months, retail sales have risen 3.7 percent, down from a 4.7 percent pace experienced in April. As such, it appears that consumers have become more cautious in their spending this summer even as we have continued to see relatively modest gains so far in 2014.
Motor vehicle sales (down 0.2 percent) declined for the second month in a row. Excluding auto sales, retail spending was up just 0.1 percent, indicating broader weaknesses. Bright spots included miscellaneous store retailers (up 0.9 percent), clothing and accessory stores (up 0.4 percent), health and personal care stores (up 0.4 percent), food and beverage stores (up 0.3 percent), food services and drinking places (up 0.2 percent) and sporting goods and hobby stores (up 0.2 percent).
Yet, these gains were largely offset by spending declines for department stores (down 0.7 percent), motor vehicle and parts dealers (down 0.2 percent), electronics and appliance stores (down 0.1 percent), furniture and home furnishings stores (down 0.1 percent) and nonstore retailers (down 0.1 percent).
On a year-over-year basis, segments with the fastest retail sales growth were health and personal care stores (up 7.3 percent), food services and drinking places (up 6.2 percent), motor vehicle and parts dealers (up 6.0 percent), nonstore retailers (up 5.9 percent) and building material and garden supply stores (up 5.1 percent).
Chad Moutray is the chief economist, National Association of Manufacturers.