Retail numbers beat expectations despite rising prices in October, according to the latest data from the Census Bureau…(Census Bureau)
- M-O-M: Advance estimates of U.S. retail and food services increased 1.7% to $638.2 billion in October 2021.
- Y-O-Y: Retail sales were up 16.3% when compared to the same time one year ago.
BEAT THE STREET: Economists had projected a smaller increase of 1.0%.
Online retailers saw the biggest jump in October thanks to consumers getting ready for the holiday season…
- Nonstore retailers saw 4% month-over-month growth followed by gas stations (+3.9%), electronic stores (+3.8%), and home improvement stores & miscellaneous store retailers (+2.8%).
Not surprisingly, gas stations had the biggest jump year-over-year jump with a 46.8% increase in October 2021.
- Restaurants and bars were in the number two spot up 29.3% year-over-year followed by department stores (+27.6%), miscellaneous stores retailers (+25.8%), and electronic stores (+18.4%).
Gus Faucher, chief economist at PNC Financial Services Group told the Wall Street Journal “consumers say they’re pessimistic—we have had very high inflation—but the truth is they’re in very good shape right now.” He went on to cite the roughly $2 trillion in excess savings that households have accrued since the start of the pandemic.
While this is true, I can’t imagine a lot of Americans are happy that they have to dip into their savings to buy groceries when at the start of the year they could afford them without a problem. Not to mention this is not sustainable long-term. Eventually you deplete your savings and then the U.S. economy has a problem. This is why yesterday former Treasury Secretary Lawrence Summers tweeted, “Excessive inflation and a sense that it was not being controlled helped elect Richard Nixon and Ronald Reagan, and risks bringing Donald Trump back to power.”