Retail August 2022:

Retail sales numbers were better than expected in August, as price increases in many sectors offset a sharp drop in gas station receipts, the Census Bureau said Thursday.

Advance Retail sales for the month Up 0.3% from July, unchanged from the Dow Jones estimate. The aggregate is not adjusted for inflation, which rose 0.1% in August, suggesting that spending is outpacing price increases.

inflammation Measured by the Consumer Price Index It rose 8.3% year-on-year to August, while retail sales rose 9.3%.

However, sales excluding autos fell 0.3% for the month, below estimates for a 0.1% increase. Excluding autos and gas, sales rose 0.3%.

Sales at motor vehicle and parts dealers led all categories, rising 2.8%, helping to offset a 4.2% decline at gasoline stations, whose receipts fell as prices fell sharply. Online sales also fell by 0.7%, while bar and restaurant sales increased by 1.1%.

Revisions to July numbers pointed to further consumer struggles, initially unchanged but down 0.4%.

Also, the “control” group, which economists use to pin down retail sales, was unchanged from July. This group excludes sales by auto dealers, building materials dealers, gas stations, office supply stores, mobile homes and tobacco shops and is used by the government to calculate the share of retail sales in GDP.

“Higher inflation drove the top-line sales numbers, but in real terms, volumes have clearly fallen as sales are negative,” said Peter Bookwar, chief investment officer at Bleakley Advisory Group. “Core retail sales fall short of expectations, lowering GDP estimate for Q3 as stated.”

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Ian Shepherdson, chief economist at Pantheon Macroeconomics, called the release “a mixed report, but we see no cause for alarm”. A decline in housing affordability will reduce some relative sales numbers, but overall spending should increase as real incomes rise, he said.

Retail sales numbers led to a busy day for economic data.

Elsewhere, Initial unemployment claims The total for the week ended September 10 was 213,000, down 5,000 from the previous week and better than the estimate of 225,000. Import prices fell 1% in August, less than an expected 1.2% decline.

Two productivity gauges showed mixed results: the New York Federal Reserve Empire State Manufacturing Index September showed a value of -1.5, 30-points higher than the previous month. However, the Philadelphia Fed’s Gage It came in at -9.9, a big drop from August’s 6.2 and below expectations for a positive 2.3 reading.

The two Fed gauges, reflecting the percentage of firms reporting expansion and contraction, showed that output for the month lagged broadly.

However, reports indicated some easing of price pressures. For New York, the prices paid and received indexes fell 15.9 and 9.1 points, respectively, although both remained firmly in growth territory with readings of 39.6 and 23.6. In Philadelphia, prices paid fell nearly 14 points, but prices rose 6.3 points. Those indices were 29.8 and 29.6, respectively, indicating prices are still rising overall, but at a slower pace.

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