Retail sales basically flat in April
- Consumer spending rose 0.4% in April, according to the Commerce Department.
- Core categories, which exclude gasoline, building materials and food service, reported 0.7% growth.
- Inflation has cooled, but impacts for consumers and retailers continue to impact purchasing habits.
Consumer spending increased 0.4% in April, according to data from the U.S. Commerce Department. Sales in core categories, which excludes gasoline, building materials and food service, rose 0.7%.
According to the report, published May 16, the retail industry recorded $686.1 billion in sales last month — up 1.6% from April last year. The 0.4% increase follows a 0.7% decrease in sales in March.
According to the data, the largest sales increases during the previous month were reported in:
- miscellaneous stores category — increased 2.4%.
- non-store retail category — grew 1.2%.
- general merchandise stores — up 0.9%.
Sales at grocery stores were down 0.4% compared to the previous month, though sales increased 3.7% compared to the same month in 2022.
The slow growth comes as consumers face continued inflationary pressures, even as it continues to cool from its peak last year.
As Retail Leader previously noted, cooling inflation represents positive news for consumers, but it’s unlikely to provide immediate relief to them or to retailers. Consumer perceptions and behaviors around price and the economy that developed during the last year or so are likely to persist even while conditions improve.
The Federal Reserve has responded to continued inflation by hiking interest rates, most recently raising them by 0.25%, though it this month signaled continued hikes could finally cease. Fed Chair Jerome Powell earlier in May said economic conditions — including the recent failure of three major banks — “may not be far off, or possibly even at” a level where it would end rate hikes.