Unemployment is at a historic low, workers are gaining in pay and the stock market is setting records.
All of that positive economic news convinced American shoppers to spend more money at retailers last month. They did all that spending despite naggingly high prices.
The Commerce Department said retail sales rose 0.4% from August to September. The third straight monthly increase was up from 0.1% the previous month. Online retailers, restaurants, and grocery stores all reported higher sales, the Associated Press reported.
Sales at gas stations fell, because of lower pump prices. The retail sales figures aren’t adjusted for inflation, and the prices of goods fell slightly last month.
According to the AP report, Thursday’s figures were the latest sign that household spending is fueling a steady economic expansion even while inflation has cooled.
“Retail sales came in well above expectations and continue to defy the ‘weak economy’ thesis,” Quincy Krosby, chief global strategist for LPL Financial, a wealth management firm, told the AP.
Restaurant sales jumped 1% from August to September, a sign that many Americans remain confident enough in their finances to boost their discretionary spending. Rising sales at sporting goods outlets point in the same direction.
Clothing store purchases leapt 1.5% last month, though sales at electronics and furniture stores dropped.
Last week, the government reported that consumer prices rose just 2.4% in September from a year earlier, down from a peak inflation rate of 9.1% in June 2022, nearly reaching the Federal Reserve’s 2% target.
Many analysts say they think cooler inflation and lower borrowing rates will help support the economy in the coming months. Last quarter, the economy grew at a solid 3% annual rate, according to the AP report.
