Retail sales show slow growth in August, according to NRF and Commerce data
September 13, 2013
Despite some indications that the economy is emerging from dark times, there were no clear-cut signs of that in retail sales numbers for August released by the United States Department of Commerce and the National Retail Federation (NRF) today.
Commerce reported that August retail sales at $426.6 billion were up 0.2 percent compared to July and up 4.7 percent compared to August 2012. Total retail sales from June through August are up 5.4 percent annually.
The NRF reported that August retail sales, which exclude autos, gas stations, and restaurants, were up 0.1 percent on a seasonally-adjusted basis from July and were up 3.9 percent on an unadjusted basis annually.
“Retail sales gains continue to be tepid,” NRF Chief Economist Jack Kleinhenz said in a statement. “Retail sales and employment, while measurably positive, have been disappointing over the last few months, and have been difficult to reconcile with consumer confidence. The data suggests that consumers remain cautious with their pocketbooks and purchases. This month’s weak retail sales report will continue to put pressure on policymakers, who are dealing with tapering, and retailers, who will need to focus on price and value to entice consumer spending.”
As previously reported, with retail sales growth modest at best, there still remains a mixed bag of signals and headwinds on the economic front, including a slightly declining unemployment rate, improving consumer confidence data, as well as encouraging automotive sales and housing data.
These things continue to occur, though, against the backdrop of sluggish GDP growth and general uncertainty regarding the economy.
“Retail sales lost momentum in August after a strong increase in July,” wrote IHS Global Insight analyst Chris Christopher in a research note. “This is not a good report. In August, consumers pulled back after making a comeback in July. Our third quarter consumer spending outlook is looking slightly lower after this report and our back-to-school retail sales outlook is now considerably lower. The summer ended on a sour note for many retailers; however, a modest pick-up in September is expected.”
Even though the August data is not encouraging, there could be help on the way in the coming months in the form of higher U.S. imports, according to the most recent edition of the Port Tracker report from the NRF and Hackett Associates.
Hackett Associates Founder Ben Hackett said in the report that the U.S. economy is on the road to sustained growth, with second quarter GDP of 2.5 percent beating expectations, coupled with an improving unemployment outlook, with consumer spending expected to increase in the fourth quarter.
“A good amount of that growth is likely to come from back-to-school and the holiday season, but we are keeping our eye on housing starts as well, which we expect to continue to pick up as the year goes on,” said Hackett in a recent interview.
What’s more, he observed that the inventory-to-sales ratio is relatively high although it has not shown any indicators that it is rising, which could lead to a decent Peak Season this year with increased shipment activity.
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