ARLINGTON, Va.—Despite flat total retail sales in July, NAFCU says U.S. consumer spending is expected to pick up for the rest of the year given the positive labor market, low gasoline prices and increased access to credit.
New Census Bureau data shows year-over-year growth in retail sales was 2.3% in July, down from 3% in June. June’s retail sales were revised up from 0.6% to 0.8% growth.
Core retail sales (excluding light vehicles and gasoline) decreased 0.1% in July, while retail sales of auto and gas increased 0.1% for the month. Core retail sales increased 3.8% from a year ago, while auto and gas decreased 1.5% from a year ago.
Results among the major retail segments were mostly negative in July. Non-store retailers, boosted by Amazon’s Prime Day sales, had the largest gain with an increase of 1.3% for the month. Auto and parts dealers followed with a 1.1% sales increase. Sales at gasoline stations declined 2.7%, followed by sporting goods and hobbies stores (-2.2%), restaurants (-0.6%), building materials stores (-0.5%) and apparel stores (-0.5%).
“Auto and parts sales improved as new vehicle sales rebounded strongly in July, but a drop in fuel prices hurt sales at gas stations,” NAFCU Research Assistant Yun Cohen said the trade association’s latest Macro Data Flash report. “Deflationary pressures from abroad remain a constraint to sales growth, and recent readings on consumer confidence have been somewhat mixed.”