Even as prices continued to soar, U.S. consumers continued to spend in April, with retail sales rising roughly in line with Wall Street expectations.
The U.S. Commerce Department released a report on Tuesday (17th) that sales in April rose 0.9% overall, slightly lower than the “Dow Jones“Expected growth of 1%. Excluding autos, sales rose 0.6%, beating expectations for a 0.4% gain.
The numbers are not adjusted for inflation, so they represent both ongoing spending and the fastest rise in U.S. prices in regarding 40 years.
Jeffrey Roach, chief economist at LPL Financial, said: “April retail sales show consumers are weathering inflation headwinds, rising for the fourth straight month.” “Core retail sales show consumers are likely to tap into their savings. To offset signs of falling real wages. If price pressures ease enough to relieve some of the pressure on consumers, growth is expected to rebound in the second quarter.”
In addition to April’s solid performance, spending in March was revised up sharply, from 0.5% to 1.4%; sales excluding autos were also revised up sharply, up 2.1% in March, compared with growth 1.1%.
Compared with the same period last year, total sales rose 8.2%, and sales excluding automobiles rose 10.9%.
Growth in April was primarily driven by a 4% increase in miscellaneous retail sales and a 2.1% increase in online sales. Bars and restaurants also posted solid growth of 2%. All three categories posted higher gains than in March.
The gains came even as energy prices fell in April, with gas station prices down 2.7%. Excluding gas stations, sales rose 1.3 percent. Even with the drop from the previous month, gasoline sales surged 36.9% from a year ago.
Sales at bars and restaurants were up 19.8% from a year ago, when the economy was still struggling with coronavirus-related restrictions.
Despite inflationary pressures, the sales figures were largely in line with continued economic growth. Prices rose 0.3% overall in April, excluding food and energy prices, which rose 0.6%. On an annual basis, the consumer price index (CPI) rose 8.3% overall in April, while the core CPI rose 6.2%.
Gross domestic product fell at an annualized rate of 1.4% in the first quarter, but most economists expect GDP growth to pick up for the full year.
Industrial production rose 1.1 percent in April, well ahead of the “higher than the 1.1 percent increase in industrial production,” according to separate Federal Reserve data on Tuesday.Dow Jones» expected 0.5%; capacity utilization, or the level of potential output being realized, increased to 79%, slightly above the 78.6% estimate.
