July retail sales rose 0.6%
July retail trade sales rose 0.4% from June 2018, and 6% yer over year, while e-commerce sales rose 0.8% from June and 8.7% from last year, according to the latest monthly report from the U.S. Commerce Department’s census bureau. Excluding automobiles, retail sales fared a little better, rising 0.6%, but June retail sales were revised down from a 0.5% rise to 0.2%.
Furniture and home furniture sales fell 0.5% from June but rose 3.5% year over year; health and personal care sales fell 0.4%, rising 5% year over year; and sporting goods, hobby and book sales fell 1.7% from June and 4.9% year over year. Other categories fared better: Clothing and accessories sales rose 1.3% from June and 6.4% year over year; department store sales rose 1.2% from June and 0.3% year over year; and electronics and appliance sales rose 0.1% from June and 4.2% year over year.
The news came as the Federal Reserve Bank of New York’s Center for Microeconomic Data reported Tuesday that total U.S. household debt rose by 0.6% or $82 billion to $13.29 trillion in the second quarter — the 16th consecutive quarter with an increase. Overall household debt is now 19.2% above the post-financial-crisis trough reached during the second quarter of 2013, according to the report.
July marks another month of a retail boom, thanks to a backdrop of low unemployment and rising wages in some areas, which in turn is bolstering consumer confidence.
"Macroeconomic data continues to be a tailwind for retail," Retail Metrics analyst Ken Perkins said in comments emailed to Retail Dive. "Unemployment is low. Job creation ... is solid. Small business confidence is near cycle highs. Consumer confidence and business sentiment are elevated. Housing has shown some signs of softening. Interest rates are rising. Gas prices are up. Trade concerns are mounting. Overall positive macro."
The results were better than expected, according to a note from Moody's Investors Service emailed to Retail Dive. "We expect this trend to continue through 2018 on the back of a strong economy, with record low unemployment and rising consumer confidence, with total year over retail sales growth for 2018 coming in at the higher end of our current forecast of 3.5% to 4.5%," Moody's Vice President Mickey Chadha said.
But the New York Fed on Wednesday reported rising household debt in the U.S. that is beginning to rival that of a decade ago. That, plus rising gas prices, could provide some headwinds as retailers gear up for holiday sales.