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Retail Sales Climb More Than Expected As Consumer Confidence Climbs
October 25, 2024
Consumer spending picked up in September and consumer confidence reached a 6-month high, underscoring a resilient economy that is now getting a boost from falling interest rates.
Retail sales climbed by a seasonally adjusted 0.4% last month, according to the Commerce Department. That’s up from the 0.1% gain seen in August and better than the 0.3% gain that Dow Jones had forecast.
Excluding auto sales, retail sales accelerated 0.5%, better than the economist forecast of just a 0.1% increase. Retail sales figures are adjusted for seasonal factors, but not for inflation. Inflation increased 0.2% for the month, as measured by the consumer price index.
The gains were spread across a variety of sectors, with miscellaneous retailers seeing the biggest increase, 4%. Spending was also up at clothing stores (1.5%) and bars and restaurants (1%). Those gains were offset by a 1.6% drop in spending at gas stations amid falling gas prices. Electronics and appliance stores and furniture stores also saw sizable declines of 3.3% and 1.4% respectively, suggesting that consumers are still hesitant to make big-ticket purchases with interest rates still high.
In another promising sign for the U.S. consumer, the University of Michigan’s consumer confidence index reached a six-month high in its second October reading. The index has risen for three consecutive months and stands at the highest level since April.
