ARLINGTON, Va.—Total retail sales increased 0.3% in November, compared to a 0.2% decline in October.
“Total retail sales rebounded from the first monthly decline since March, advancing by 0.3% in November,” said NAFCU Vice President of Research and Chief Economist Curt Long. “Several of the segments that contracted in October showed markedly better sales last month, like furniture stores (-2.2% Oct.; +0.9% Nov.) and auto dealers (-1.2% Oct.; +0.5% Nov.). One area where that was not the case is gas stations, where the drop in gas prices is suppressing nominal sales (-1.2% Oct.; -2.9% Nov.).
“But consumers are using those savings at the pump to boost discretionary spending, particularly at restaurants, where sales increased 1.6% in November and are up over 11% from a year ago.”
Additional Details
Sales within the control group – which excludes the auto, gas, and building material categories and is the basis of the Commerce Department's estimate of personal consumption expenditures – increased 0.6% in November.
Monthly growth in retail sales was mixed. Gains were led by restaurants and bars (+1.6%), sporting goods and hobby stores (+1.3%), and nonstore retailers (+1%). Losers included gas stations (-2.9%), miscellaneous retailers (-2%), and electronics and appliance stores (-1.1%).
Watching Consumer Spending
“Consumer spending will be watched closely for signs that households are raising nominal spending levels on the basis of easing financial conditions and an improved outlook due to slower inflation. While market participants have resoundingly concluded that the Fed will cut rates in March, NAFCU believes it is still close to a coin flip between March and May,” said Long.
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