WASHINGTON–Retailers may not be pleased over the latest national sales figures, but the Federal Reserve will be, according to one credit union economist.
The Commerce Department is reporting that U.S. retail sales fell 0.1% in October from a month earlier, marking the first decline since March. The new numbers come a month after a 0.9% increase in September. From a year earlier, sales rose 2.5% in October, well slower than the pace of price increases.
"Total retail sales decelerated for the first time since June, falling by 0.1% month-over-month,” said NAFCU Vice President of Research and Chief Economist Curt Long. “Federal Reserve officials will be pleased to see a controlled decline in consumption, which is critical for achieving a soft landing. In conjunction with the downside surprise from the latest CPI report, NAFCU believes the Federal Reserve has hit its terminal rate and is now turning its attention toward a rate cut, which should occur in the first half of 2024."
Spending Less on Cars, Gas
The Wall Street Journal said the Commerce Department data show Americans spent less at auto dealerships as higher interest rates could deter some from making big-ticket purchases.
“Gasoline purchases also fell, as declining prices at the pump resulted in less spending at gas stations. Sales also declined at department, hardware and furniture stores,” the Journal noted. “Consumers continued to spend more at restaurants and bars, with sales rising 0.3%, and at grocery stores and online.”
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