US Retail Sales Get Boost from Back to School

US retail sales rose in August as families bought school supplies and household goods despite ongoing inflation and high interest rates.

Revenue increased 0.6% from the previous month to $697.6 billion — adjusted for seasonal variation — according to data the US Census Bureau released last week. This followed a 0.5% rise in July.

However, the pace of retail growth is slowing, reported the National Retail Federation (NRF), attributing this decline to the rising cost of credit and the depletion of consumer savings that built up during the pandemic.

“August retail sales show that consumers remain steadfast in the face of continued inflation and higher interest rates,” said NRF CEO Matthew Shay. “Consumers are focused on household priorities, as [is evident from] spending this back-to-school season. Entering the fall, we expect moderate growth to continue despite uncertainties like the direction of inflation and interest rates as well as a potential government shutdown.”

Sales were 2.5% higher than in the same month of 2022, down from July’s 2.6% year-on-year increase, the NRF added. The federation expects sales to continue rising, but at a reduced pace.

“Households have the capacity to spend, but momentum is slowing,” said NRF chief economist Jack Kleinhenz. “Consumer spending growth has slowed, but there is little hint of any sudden collapse.”

In August, sales advanced year on year in five of the nine categories the US Census Bureau monitors. The clothing and accessories segment — which includes jewelry — rose 3.6% and registered a 0.9% increase from July. Online sales across all products grew 8% from a year earlier and were flat compared with the previous month.

Image: A woman shopping at a mall. (Shutterstock)