Retail sales rose in April even as inflation forced cuts in non-essential goods
Despite pressure from inflation and high interest rates, shoppers found enough room in their budgets to shop in April, albeit cutting back on some luxury goods.
Retail sales rose 0.4 percent in April to $686 billion, reversing two months of declines, the Census Bureau said Tuesday. It was just the second increase in six months and below the 0.8 percent jump that economists had forecast, leaving sales still below the $693 billion peak reached in January. Sales rose a healthier 0.6 percent excluding gasoline and autos, meeting the average forecast among economists.
“The continued impact of inflation on consumers is evident in year-over-year comparisons with significant declines in discretionary categories,” said Claire Tassin, retail and e-commerce analyst at Morning Consult, in a comment. “Buyers continue to make tough trade-offs and delay purchases to meet their financial obligations.”
The report highlights how the increase in the cost of living from 2021 has forced people to change their spending patterns.
While inflation is on a definite downward trend, things like food and cars are much more expensive than they were a year ago. Tassin cited an April Morning Consult survey showing that 85 percent of Americans said they were concerned about the impact of inflation on their household finances.
Sales rose in several categories such as online stores, which rose 1.2 percent, and restaurants, which rose 0.6 percent. However, the stress on household budgets weighed on sales of home furnishings, which fell 0.7% (down 6.4% last year) and electronics, which fell 0.5% for a 7.3% year-on-year decline. base.