Retail sales grew 0.7% in September compared to the previous month. This marks the sixth consecutive month of growth. Considering the 0.4% increase in consumer prices in September, inflation-adjusted retail sales rose by 0.3%.
Spending increased across most categories last month, with sales in specialty stores rising the most, by 3%. Online sales and automobile purchases also saw strong growth, both up 1.1% in September compared to August. The two weakest sales categories last month were clothing and electronics, which fell by 0.8% during the same period.
With high employment, wage gains outpacing inflation, and lower expectations regarding a recession, consumer spending continues to drive the economy.
However, it is widely expected that the U.S. economy will lose some momentum in the coming months, including the possibility of a weaker labor market and more restrained consumption, which accounts for about two-thirds of economic output.
The 11 rate hikes by the Federal Reserve, the American Central Bank, stricter credit standards, and fatigue caused by high inflation are expected to rein in the economy in the last months of the year.
Nevertheless, economists say that the economy’s performance during the holiday season will be crucial for understanding the trajectory of the economy in the early months of 2024.
Source: CNN