Even record inflation didn’t damper Americans' penchant to spend in April, as retail sales overcame higher prices to show both monthly and year-over-year increases.
Retail sales rose 0.9% in April from March and were up 6.4% year-over-year, according to the National Retail Federation, whose calculation excludes automobile dealers, gasoline stations and restaurants In March, sales increased 1% month over month and 3.9% year over year.
“April retail sales demonstrate consumer strength and willingness to spend despite persistent inflation, supply chain constraints, market volatility and global unrest,” NRF President and CEO Matthew Shay said. “While consumers are facing higher prices, they are preserving their budgets by shopping smart. Retail businesses are also facing increased costs like higher energy bills and rents as well as the cost for goods, transportation and wages. Despite already tight margins, retailers remain committed to their customers and are doing everything they can to absorb these costs to keep products affordable. With the Federal Reserve already raising interest rates, the Biden administration and Congress have an opportunity to provide targeted relief to American households by lifting the China tariffs, passing legislation to fix the supply chain and addressing immigration reform to ease the tight labor market.”
“April’s retail sales data is encouraging because it shows consumers are taking higher prices in stride and remain resilient,” said NRF chief economist Jack Kleinhenz. “Sales benefited from Easter/Passover spending and also from tax refunds, which have been delayed by pandemic-related issues at the IRS but are also larger than usual.”
High gasoline prices, rising interest rates and price pressures across the board continue to be headwinds to spending, Kleinhenz noted. But they are being offset by wage and job gains “with a tailwind that should bode well for moderate-but-steady spending growth going forward,” he said.
April sales were up in two-thirds of categories on both a monthly and yearly basis, with year-over-year gains led by online sales (up 11.3% year-over-year) and clothing (up 11.2% year-over-year) and grocery stores (up8.9% year-over-year).
Specifics from key sectors for April month-over-month sales are below.
Online and other non-store sales were up 2.1%.
Clothing and clothing accessory stores were up 0.8%.
Grocery and beverage stores were down 0.2%.
General merchandise stores were up 0.2%.
Health and personal care stores were up 0.7%.
Furniture and home furnishings stores were up 0.7%.
Building materials and garden supply stores were down 0.1%.