U.S. Retail Sales Held Steady in July
August 17, 2022
U.S. consumers maintained their level of spending last month, even amid persistent inflation. Shoppers shifted the money saved by falling gasoline prices to increased online purchases of everyday goods.
Overall retail sales, which include spending at stores, online, and in restaurants, were flat in July compared with the prior month’s downwardly revised 0.8% increase, according to the Commerce Department. Economists surveyed by Dow Jones had expected a 0.1% increase.
A measure of spending that strips out gasoline and auto sales rose 0.7% last month from June.
Retail sales numbers are adjusted seasonally, but not adjusted for inflation. In July, the consumer price index was flat on a monthly basis.
A precipitous drop in gasoline prices from record highs seen earlier in the summer pushed down sales at the pump, with gas station receipts off 1.8%. Motor vehicle and parts dealers sales also fell sharply, declining 1.6%.
This freed up money from consumers to shop online, where retail sales increased 2.7% for the month.
Still, it appears that consumers are being stretched by higher prices and consumption may be slowing when inflation is taken into account. Food sales for the month rose just 0.2%, but the Bureau of Labor Statistics food price index showed that prices increased 1.1%, suggesting that consumption is not keeping pace.