US retail sales continue to rise in April amid rising prices

US retail sales continue to rise in April amid rising prices

US retail sales continue to rise in April amid rising prices

US retail sales continue to rise in April amid rising prices

Advertisement

Americans increased their shopping spending for the fourth consecutive month in April, with inflation at a 40-year high, as auto sales rebounded,  according to government data released Tuesday,

According to the Commerce Department, US retail sales increased 0.9 percent month on month to $677.7, while auto sales increased 2.2 percent in April after declining in March.

However, when vehicles and parts are removed, sales increased by 1.3 percent, far exceeding analysts’ expectations.

With gasoline prices on the rise due to the war in Ukraine and sanctions on Russia, sales at gasoline stations fell 2.7 percent, after surging in the prior two months, the report said.

The healthy US consumer has underpinned the strong recovery in the world’s largest economy following the slowdown during the Covid-19 pandemic, but the surge in demand also has strained supply chains and helped push inflation to its fastest rate since the early 1980s.

Advertisement

“Looking ahead, consumers’ tolerance to high inflation will continue to be tested and the renewed spike in gasoline prices, along with tighter financial conditions, will weigh on households’ willingness to spend on big-ticket items,” said Kathy Bostjancic, a chief US economist at Oxford Economics.

Total retail sales were 8.2 percent higher than April 2021, while the increase excluding autos was 10.9 percent, according to the data.

The biggest increases in the month were for electronics, home furnishings, and clothing, while restaurants and bars saw a 2.0 percent increase and online sales increased by a similar amount.

The strong start to second-quarter US growth underscores the need for the Federal Reserve to continue raising borrowing rates to cool demand and tamp down inflation pressures, economists say.

“For the Fed, these data are still showing upward momentum in growth and combined with decades-high inflation, warrant a removal of policy accommodation,” said Rubeela Farooqi, chief US economist at High-Frequency Economics.

Advertisement
Advertisement
Read More News On

Catch all the International News, Breaking News Event and Latest News Updates on The BOL News


Download The BOL News App to get the Daily News Update & Follow us on Google News.


End of Article

Next Story