The Census Bureau reported that retail activity was flat in July as falling fuel prices held back gas station sales.
Total receipts rose 0.4% even though advance retail sales were not changed. The economists had been looking for a flat number and a small increase in the topline number. The June gain was revised down.
Food and retail sales increased from a month ago.
During a month when the consumer price index was flat, the numbers are adjusted but not for inflation.
A tumble in fuel prices off their record highs caused a decline in sales at the pump. Sales of motor vehicle and parts dealers fell steeply.
The average price of gas in July was $3.94 a gallon, down from a high of $5 a gallon earlier in the summer.
Ian Shepherdson wrote that people seem to have used some of the savings from lower gas prices to spend more on other items. The chip shortage has severely constrained auto sales. Department stores and clothing retailers lost in July, but all of them are subject to revision.
There were decreases in gas and auto sales, but there was also an increase in online sales.
Consumers have been fighting to keep up with an inflationary environment that has seen prices overall increase 8.5% from a year ago Even though the price of energy fell in July, gas station receipts rose 39.9% from a year ago.
Consumers were able to spend elsewhere in July due to the decline in fuel prices.
The food price index rose 1.1% for the month and food sales rose just 2%. Bars and restaurants saw a small rise in sales.
Retailers are struggling in the current environment.
Target said on Wednesday that it has had to mark down prices on unwanted inventory as its sales have plummeted.
Interest rate increases have been used by the Federal Reserve to keep inflation under control. In June and July, the central bank hiked their rates by 0.75 percentage points and are expected to keep hiking until inflation comes down.
All Rights Reserved © 2024
