Consumers remained resilient in June as inflation climbed higher and drove up prices across the board.
Retail sales increased 0.6% in June from May and were up 5.8% year over year, according to the National Retail Federation, whose
calculation excludes automobile dealers, gasoline stations. In May, sales were down 0.3% month over month and up 6.3% year over year.
“Inflation remains a challenge to consumers trying to make ends meet and will continue to be an issue even if it cools down in the months ahead,” said NRF chief economist Jack Kleinhenz. “Despite that, consumers are holding up notably well and continuing to spend.”
The U.S. Census Bureau said overall retail sales (includes gasoline stations and restaurants) in June were up 1% from May and up 8.4% year over year. That compared with a 0.1% month-over-month decrease and 8.2% year-over-year increase in May.
“Consumer spending remains robust,” said Naveen Jaggi, president retail advisory services, JLL. “However, as inflation persists consumers are paying more for essentials. Retail foot traffic largely declined in June, with the exception of experience-related tenants like theaters, fitness and eatertainment attractions, so its clear retail sales are rising nominally because of higher prices.”
Jaggi added thatretail sales will continue to rise next month as more parents continue to shop for back-to-school. The NRF is forecasting that back-to-school (K-12) spending will reach $37 billion, with families planning to spend an average of $864 on school items, approximately $15 more than last year.
Specifics from key sectors for June over May include:
Online and other non-store sales were up 2.2%;
Grocery and beverage stores were up 0.4%;
Building materials and garden supply stores were down 0.9%;
Furniture and home furnishings stores were up 1.4%
Sporting goods stores were up 0.8%;
General merchandise stores were down 0.2%;
Clothing and clothing accessory stores were down 0.4;
Health and personal care stores were down 0.1%; and