Retail sales unexpectedly increased last month despite continued challenges facing the economy as it recovers from the coronavirus pandemic.
Sales ticked up 0.7% in August relative to July and totaled $618.7 billion, according to a Census Bureau report published Thursday. E-commerce, furniture, general merchandise, building materials and energy purchases drove last month’s sales increase.
Dow Jones economists had expected sales to decline 0.8%, CNBC reported. In July retail sales posted a sharp 1.8% decline as coronavirus cases surged, the Census report said Thursday. (RELATED: Democrats Block Bills Prohibiting Tax Increases Until Unemployment Rate, Inflation Return To Pre-Pandemic Levels)
“We really got a head fake and this happens a lot. A couple of weeks ago it looked very disappointing,” National Securities Corporation Chief Market Strategist Art Hogan told Yahoo Finance. “It’s a classic example of consumers actually saying one thing and doing something else.”
People purchase tickets at the reopened box office for Broadway shows in Times Square on Tuesday in New York City. (Spencer Platt/Getty Images)
While the overall sales figure increased, the volatile automobile category saw a significant decline of 3.6%, according to the Census Bureau. Excluding car sales, total retail sales increased 1.8% in August compared to July.
Non-store retail sales, which mainly include online shopping, increased 5.3% month-over-month, the largest uptick of any category. E-commerce prices, though, have skyrocketed over the last year as a result of economy-wide inflationary pressures.
In addition, furniture sales increased 3.7%, general merchandise store sales rose 3.5%, food sales increased 1.8%, building materials sales grew 0.9% and gasoline sales ticked up 0.2%. Electronics and sporting goods sales declined by 3.1% and 2.7% respectively.
Inflation, meanwhile, has continued to rise to new multi-decade highs. Consumer prices rose an annual rate of 5.3% in August compared to their pre-pandemic average increase of 2.5%.
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