U.S. Retail Sales Grew 0.9% in April
U.S. shoppers increased retail spending in April for the fourth straight month as inflation held close to its highest level in four decade, the Commerce Department said Tuesday.
Retail sales—a measure of spending at stores, online and in restaurants—aren’t adjusted for inflation. That means that while consumers have continued to spend more, they are likely getting less due to rapidly rising prices. In March, for instance, retail sales rose largely because of a sharp jump in gasoline purchases linked to record high prices following Russia’s invasion of Ukraine in late February.
Consumers are continuing to feel the pinch from high inflation, which rose 8.3% in April from a year earlier, according to the Labor Department’s consumer-price index.
Stephen Stanley,
chief economist at Amherst Pierpont Securities LLC, said April sales figures are likely to reflect a short-lived respite last month from rising gas prices, an expected increase in new vehicle sales and volatility in sales by online retailers, which declined sharply in March. “There’s a lot of crosscurrents going on,” he said.
Consumer spending, adjusted for inflation and seasonality, accelerated in the first quarter compared with the end of last year, according to the Commerce Department. Consumer spending is a driving force for the U.S. economy.
There are signs, however, that spending on goods, which make up most of the retail-sales report, is easing as prices continue to rise. Adjusted for inflation, retail sales fell by 0.7% in March, according to the Federal Reserve Bank of St. Louis and economist estimates.
Sales of vehicles likely rose in April as supply-chain disruptions eased slightly, while spending on gasoline likely declined as prices pulled back briefly from a sharp run-up related the war in Ukraine. Gasoline prices have since risen again, hitting a record high earlier this month.
Consumers have also shifted some spending to services from goods as a winter surge of Covid-19 from the Omicron variant faded and many people resumed more in-person activities.
JPMorgan Chase
& Co.’s tracker of credit- and debit-card transactions last week showed that consumer spending at restaurants and on entertainment picked up in early May.
Stephen Purtell,
interim chief financial officer at
Six Flags Entertainment Corp.
, said on an earnings call last week that despite recently rising Covid-19 cases, “people are just learning how to live within that environment, and they’re still going out.”
After many people earlier in the pandemic focused more of their spending at home, Mr. Purtell said, “now you see kind of a reversal of that and people wanted to get back out and enjoy experiences, and we don’t think that will change.”
California resident Larry Isacson said he paid more for a hotel stay than he would have expected a few years ago.
Photo:
Isacson family
Larry Isacson,
a retired information-technology executive in the pharmaceutical industry, took a trip to Las Vegas and Utah in April and paid $400 a night for a hotel in St. George, Utah.
“That would have seemed exorbitant a few years ago, for a room with not that many amenities,” he said. “I just basically had to swallow it and accept that that’s what the rate is, and I want to be there so I have to pay the rate.”
Mr. Isacson said that the hotels around where he lives in Laguna Niguel, Calif., appear to be doing well. He added, “Clearly people are in the mood to spend.”
Write to Harriet Torry at [email protected]
Copyright ©2022 Dow Jones & Company, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8
U.S. shoppers increased retail spending in April for the fourth straight month as inflation held close to its highest level in four decade, the Commerce Department said Tuesday.
Retail sales—a measure of spending at stores, online and in restaurants—aren’t adjusted for inflation. That means that while consumers have continued to spend more, they are likely getting less due to rapidly rising prices. In March, for instance, retail sales rose largely because of a sharp jump in gasoline purchases linked to record high prices following Russia’s invasion of Ukraine in late February.
Consumers are continuing to feel the pinch from high inflation, which rose 8.3% in April from a year earlier, according to the Labor Department’s consumer-price index.
Stephen Stanley,
chief economist at Amherst Pierpont Securities LLC, said April sales figures are likely to reflect a short-lived respite last month from rising gas prices, an expected increase in new vehicle sales and volatility in sales by online retailers, which declined sharply in March. “There’s a lot of crosscurrents going on,” he said.
Consumer spending, adjusted for inflation and seasonality, accelerated in the first quarter compared with the end of last year, according to the Commerce Department. Consumer spending is a driving force for the U.S. economy.
There are signs, however, that spending on goods, which make up most of the retail-sales report, is easing as prices continue to rise. Adjusted for inflation, retail sales fell by 0.7% in March, according to the Federal Reserve Bank of St. Louis and economist estimates.
Sales of vehicles likely rose in April as supply-chain disruptions eased slightly, while spending on gasoline likely declined as prices pulled back briefly from a sharp run-up related the war in Ukraine. Gasoline prices have since risen again, hitting a record high earlier this month.
Consumers have also shifted some spending to services from goods as a winter surge of Covid-19 from the Omicron variant faded and many people resumed more in-person activities.
JPMorgan Chase
& Co.’s tracker of credit- and debit-card transactions last week showed that consumer spending at restaurants and on entertainment picked up in early May.
Stephen Purtell,
interim chief financial officer at
Six Flags Entertainment Corp.
, said on an earnings call last week that despite recently rising Covid-19 cases, “people are just learning how to live within that environment, and they’re still going out.”
After many people earlier in the pandemic focused more of their spending at home, Mr. Purtell said, “now you see kind of a reversal of that and people wanted to get back out and enjoy experiences, and we don’t think that will change.”
California resident Larry Isacson said he paid more for a hotel stay than he would have expected a few years ago.
Photo:
Isacson family
Larry Isacson,
a retired information-technology executive in the pharmaceutical industry, took a trip to Las Vegas and Utah in April and paid $400 a night for a hotel in St. George, Utah.
“That would have seemed exorbitant a few years ago, for a room with not that many amenities,” he said. “I just basically had to swallow it and accept that that’s what the rate is, and I want to be there so I have to pay the rate.”
Mr. Isacson said that the hotels around where he lives in Laguna Niguel, Calif., appear to be doing well. He added, “Clearly people are in the mood to spend.”
Write to Harriet Torry at [email protected]
Copyright ©2022 Dow Jones & Company, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8
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