The Commerce Department reported on Friday that retail sales increased in June. This was an unexpected surge as American consumers increased their spending on eating out, clothing and gadgets.
A 0.6% increase in sales last month highlighted the uneven recovery of the economy after a decline in spending in May. Overall sales increased, but sales of automobiles and auto parts and spending on building materials, furniture and sporting goods stores decreased.
Gregory Dako, Chief US Economist at Oxford Economics, said: “They avoided the products they consumed in large quantities during the pandemic and returned to the products they had no access to during the pandemic.”
After hitting a record low about a year ago, sales recovered this spring, boosted by a non-uniform resumption of the economy and are now fluctuating from month to month. June sales were better than economists expected, but the reaction to the rapidly spreading delta variant of the coronavirus, rising prices, and the end of government interests could hinder sales in the coming months. is there.
Last month’s sales were squeezed by a lack of computer chips, which limited the number of cars and trucks. Car makers can offer To the dealer.The· Production of automobiles and parts The Federal Reserve Board reported Thursday that it fell 6.6% in June.
The government reported this week that the shortfall pushed up prices for used cars in particular, rising 10.5% in June. The combination of low inventories and high prices has discouraged car buyers, according to economists. Excluding automobiles and auto parts, retail sales in May increased by 1.3%.
The· Consumer price index The Ministry of Labor said this week it rose at the fastest pace in June’s 13 years as inflation accelerated.A survey by the Federal Reserve Bank of New York also found that consumers have higher expectations. inflation In the short term and in the next few years.
Beth Ambobino, U.S. Chief Economist at S & P Global Rating Services, said in advance of Friday’s announcement: I’m starting. ” ..
According to Bobino, spending is also shifting from durable consumer goods such as electronics and furniture to leisure activities. Some of that spending is not reflected in Friday’s report.
“This report captures only a small portion of personal consumption in restaurants and bars, but misses every trip,” she said.
As the new semester approaches in September, Bobino relies on unemployment benefits and says more parents who may have taken care of their children while turning to distance learning will rejoin the workforce. I’m looking forward to it. This can help companies increase production and mitigate supply and product shortages.
“Some of the supply constraints companies are currently facing are expected to be eased in September,” she said.
Spending can also be affected States withdrawing early from the federal unemployment insurance program, Saved $ 300 a week with aid added to benefits last year. Twenty-four states stopped paying extended benefits, most of which stopped aid in June. According to a Bank of America analysis based on credit and debit card spending, spending in discontinued states saw a decline in consumer spending last week. ..
The state, which withdrew its profits, claimed that aid had discouraged people from looking for a job when some companies tried to staff as the economy resumed. Many economists say that stopping benefits can hurt an individual’s income more than it helps address the labor shortage.
Bovino Child tax credit, It provides an additional lift for personal consumption to all families except the wealthiest families up to $ 300 per child per month as part of a pandemic relief package. The size of the credit depends on the family’s income, the number of children, and their age.
“This can help cushion those who are unemployed when they find a job,” said Bobino.
June retail sales decline amid sluggish car sales
Source link June retail sales decline amid sluggish car sales