Retail sales show slight increases, according to Commerce and NRF
August 13, 2010
A sputtering economy received a small dose of good news, with retail sales showing gains in July, according to data released by the United States Department of Commerce and the National Retail Federation (NRF).
July retail sales, which include non-general merchandise like automobiles, gasoline, and restaurants, at $362.7 billion, were up 0.4 percent from June and up 5.5 percent year-over-year. Total retail sales from May through July of this year were up 5.9 percent year-over-year, according to the Department of Commerce.
The NRF reported that July retail sales (which exclude automobiles, gas stations, and restaurants) increased 3.1 percent unadjusted year-over-year and dipped 0.2 percent seasonally-adjusted compared to June.
“Household spending remains tepid amid concerns about economic stability,” said NRF Chief Economist Jack Kleinhenz in a statement. “Current data on the economy is mixed which signals that retailers will continue planning with caution until a long-term trend can be established.”
While the first half of 2010 showed a fair amount of promise in terms of sustained economic growth. The second half, so far, has been a different story, with unemployment at 9.5 percent, sluggish consumer spending, and declining volumes in some modes of freight transportation. But even with signs of volumes weakening, they still remain above dismal 2009 levels. One driver for this is due to manufacturers and retailers slowly building up inventories after deliberately keeping them low for months to better match up with low demand levels during the recession.
“We are still fairly positive about things in general in terms of the recovery happening, but there will be fits and starts,” said Eric Starks, president of freight transportation forecast consultancy FTR Associates, in a recent interview. “That is what we are seeing now.”
A “wait and see” approach to the economy is going to be required over the coming months, said Starks, with a better idea of where things likely stand possible in September. Whether the recent downward indicators are truly an indication of things to come—or lead to a double-dip recession of some sort—is still to be determined, he said.
And things like a fluctuating stock market, coupled with economic unrest in Europe, do little to help with overall economic confidence as well, noted Starks.
Department of Commerce Secretary Gary Locke said in a statement that the increase in retail sales shows that overall economic activity is still growing, albeit at a pace slower than desired.
“The administration understands that too many Americans continue to struggle,” said Locke. “President Obama and this department are committed to continuing to promote policies that foster job creation and a strong and sustainable economy.”
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