Retail sales saw a boost in September, increasing 0.5 percent over August sales, according to the National Retail Federation. The retail industry sales number, which excludes the automobile, gas station and restaurant sectors, was 1.5 percent less than September of last year.
The U.S. Commerce Department, from which the NRF draws its numbers, finds that there was again a moderate increase in most business categories compared to the previous month. Food & beverage stores were up 0.7 percent, and grocery stores specifically saw a rise of 0.9 percent. Health & personal care stores were up 0.8 percent.
Building material & garden equipment dealers remained the odd man out and one of the few categories to see a drop compared to the previous month (down 0.2 percent). However, furniture & home furnishing stores, which were down in August, saw the greatest boost of all the retail categories in September (1.4 percent). The growth indicates that consumers may be starting to invest more in their homes. Additionally, gasoline stations rose 1.1 percent, though this data was not included in the NRF estimate.
“Retail is not out of the woods yet, but consumers felt comfortable enough last month to spend on more than just necessities,” said Rosalind Wells, chief economist for NRF, in a statement. “As we head into the essential fourth quarter, retailers will likely continue aggressive promotions and discounts to bring people back into stores.”
The findings are consistent with yesterday’s news from Deloitte that their Consumer Spending Index rose 3.44 percent—the fourth consecutive month of increase, thanks to increasing real wages and stabilizing home prices and unemployment.
“There’s a perception out there because credit is contracting, some people thinks that has to mean that spending is going to continue to fall,” said Bob Brinker, editor of the Brinker Fixed Income Adviser. “Instead, people are just spending their cash and their savings instead of putting it on their credit card, and that’s probably a good thing over the long term.”
Brinker believes that on the whole this represents good news for retail.
“If you take an objective look at those numbers you have to be impressed that the consumer continues to stay in the game.”
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