The US Commerce Department reported that retail sales rose 1.1% in September – the strongest pace in seven months. The surprisingly good news drew cheers from Wall Street and the National Retail Federation (NRF).
“The American consumer and the retail industry continue to lead this recovery, and strong September retail sales are just what the economy needs right now,” said NRF President and CEO Matthew Shay. “The unexpectedly strong sales increase in September may work to dampen fears of a double-dip recession and could indicate an economic and employment rebound.”
NRF said much of September’s strength came as a result of retail sales increases due to Hurricane Irene and an influx of shoppers who chose to complete back-to-school shopping later this year. Building materials stores rose 6.4% over last year, sporting goods stores were up 7.2% and clothing store sales increased 8.3%. August retail sales were revised upward to 0.4% from July, which was originally reported as 0.1%.
“Despite stagnant unemployment figures and a shaky stock market, American consumers are holding their own,” said NRF Chief Economist Jack Kleinhenz. “While September’s sales figures were strong, retailers’ fourth quarter growth will continue to depend heavily on the labor market and consumer confidence, both of which continue to experience weakness.”
Additional September highlights:
-September sales were strong across the board. Sales at clothing and clothing accessory stores increased 1.3% seasonally adjusted month-to-month and 8.3% unadjusted year-over-year.
-Electronics and appliance stores sales increased 0.2% seasonally adjusted over the previous month and 0.7% unadjusted year-over-year.
-Health and personal care stores also performed well. Sales at these stores increased 0.3% seasonally adjusted over August and 4.8% unadjusted year-over-year.
-Furniture and home furnishing stores’ sales increased 1.1% seasonally adjusted from the previous month and 4.3% unadjusted over last year.
-Building materials and garden equipment stores sales decreased 0.1% from August but increased 6.3% unadjusted year-over-year.
Earlier this month, NRF forecast holiday sales to rise 2.8% this year to $466 billion. NRF defines holiday sales as retail industry sales in the months of November and December.