After a blip in September, retail sales rebounded in October to a seasonally adjusted $511.5 billion, which represents a 0.8 percent increase over the previous month and a 4.6 percent increase over the prior year period, according to the U.S. Department of Commerce. Though retail sales had reportedly eked out a 0.1 percent improvement from August to September, that number has since been adjusted to down 0.1 percent.
Clothing and accessories store sales rose 0.5 percent to $23.1 billion from the previous month and 4.7 percent year on year. While department store sales advanced 1.3 percent over September to $12.5 billion, sales in this sector declined by 0.3 percent compared to the prior year period.
The non-store retailer category, which is primarily made up of e-commerce stores, saw a 0.4 percent gain in sales for the month to $58.5 billion, which was a 12.1 percent increase over October 2017.
Sales of gas reached $46.9 billion, a 3.5 percent increase over September 2017 and a 16.2 percent over the previous October. The sporting goods and hobby category continued to suffer with a 0.5 percent increase for the month to $6.5 billion, which represented a 8.5 percent decrease in sales compared to the prior-year period.
“Today’s pickup in retail sales shows a healthy pace of spending and a sign of ongoing consumer strength which is consistent with the state of the U.S. economy,” NRF chief economist Jack Kleinhenz said. “The figures bolster expectations for the major shopping period of the year, the holidays. Thanks to a high level of consumer confidence surrounding the current and future economy, we expect spending to maintain its strong momentum.”
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Kleinhenz added that the strong performance also reflects pent up demand following the hurricanes in the fall.
Chris Rupkey, chief economist at MUFG, also anticipates a strong year-end performance.
“The consumer has the wind at their backs and with gasoline prices falling at the pump, we expect even more spending in the next couple of months,” Rupkey told Reuters.
U.K. Sales
The outlook in the U.K. is more cloudy.
In the U.K. retail sales growth continued on its slow path following a robust summer, according to the Office for National Statistics. Retail sales volume in October fell by 0.5 percent month on month but increased 2.2 percent compared to the same month in 2017.
Online sales rose 1.2 percent over September and 12.6 percent over October 2017.
E-commerce sales in the country rose to 18 percent of total retail compared to the 17.7 percent it represented in September. Apparel, textiles and footwear commanded “a record proportion of online sales” at 18.2 percent, even as sales in that sector declined.
The overall slowdown, particularly in the household goods arena, which saw a 3 percent decline in sales volume, has been blamed on the looming Brexit.
Samuel Tombs at Pantheon Macroeconomics, told BBC News that things could continue to worsen as the year wears on.
“Consumers’ confidence already has weakened in recent months due to concerns about the economic outlook and we doubt households are feeling any surer that a no-deal Brexit will be avoided after this week’s political turbulence,” Tombs was quoted as saying.
On the other hand, holiday deals could be enough to persuade reticent shoppers to spend, according to Ian Geddes, head of retail at Deloitte. Geddes predicts “record” spending on Black Friday.