Tariffs? What tariffs?
While statistics show that U.S. tariff policies may be forcing price increases on some goods and hurting the job market, American consumers seem to be shrugging them off when it comes to spending.
Helped by back-to-school spending, shoppers increased their spending at a better-than-expected pace in August from July.
Statistics released by the Commerce Department show retail sales rose 0.6% last month from July, when sales were up a revised 0.6%. In June, retail sales rose 0.9%, the department said.
The August numbers, released Tuesday, were also likely helped by the continued efforts by Americans to keep pushing up purchases ahead of expected price increases.
The sales increases followed two straight months of spending declines in April and May.
Excluding auto sales, which have been volatile since Trump imposed tariffs on many foreign-made cars, retail sales rose 0.7% in August. Sales at auto vehicle and parts dealers rose 0.5%, The Associated Press reported.
The data showed solid spending across various other outlets. Business at electronics and appliance stores was up 0.3%, while online retailers saw a 2% increase. Business at clothing and accessories retailers rose 1%.
Business at restaurants, the lone services component within the Census Bureau report and a barometer of discretionary spending, rose 0.7%, according to the AP report. Business at furniture and home furnishings stores was down 0.3%.
“This is further evidence that we shouldn’t underestimate the strength of the consumer,” Bankrate senior industry analyst Ted Rossman wrote in a note Tuesday, according to the AP. “Back-to-school shopping was a key theme in August, as evidenced by the strong clothing and electronics sales.” Government retail data isn’t adjusted for inflation, which rose 0.4% from July to August, according to the latest government report. That was faster than the 0.2% pace the previous month. So that could have inflated the sales figures as well.
