Consumer buying stays strong in September in spite of it all
Retailers fretting about Q4 sales got a little glimmer of hope this week as the National Retail Federation, a trade group, reported strong September sales in spite of the twin shocks of hurricanes and skyrocketing fuel costs. General merchandise sales, which exclude automobiles, gas stations, and restaurants, were up 7% in September on a non-adjusted basis from last year, the NRF reports. The NRF says the gains, which led third quarter sales to rise 6.4% over 2004, were stronger than it had been expecting.
“While many analysts expected consumers to hold back on spending as a result of higher gas prices, shoppers had other plans,” said NRF Chief Economist Rosalind Wells. “This is a good sign for retailers as they head into the holiday season.”
The NRF’s report is in line with retail sales numbers released today by the U.S. Commerce Department which show that total retail sales, which do include autos, gasoline stations and restaurants, rose 7.1% unadjusted year-over-year. The Commerce Department reports that gasoline sales rose 36.2% unadjusted from last September.
By category, the NRF reports that furniture and home furnishings sales were 9.3% over last year; building material and garden equipment and supplies sales were up 9.3% adjusted over last year; while electronics and appliance sales were up 6.3%; food and beverage sales, 6.1%; health and personal care, 7.6%; and clothing and accessories, 5.8%.
The NRF projects holiday sales will rise 5% to $435.3 billion.
One concern that retailers may continue to hold, however, is that inflation in September was the highest in 25 years, reaching 1.2%, mostly due to higher fuel prices.
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