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CHART OF THE DAY: Retail sales surge 5.3% as consumers spend stimulus checks

by and

Driven by the latest round of stimulus checks approved in late December, retail sales surged 5.3% in January from a monthly decline of 0.7% in December, the Commerce Department reported on Wednesday.

The gains, which smashed economists’ consensus forecast of a 1.1% increase, were particularly strong in e-commerce (11%), furniture (12%) and electronics (14.7%) and are a reflection of the demand that has built up among consumers, particularly for more expensive items, amid the resurgence of the pandemic this winter.

Consumer demand will be one of the primary drivers of an economic recovery this year as foot traffic in stores starts to come back.

Another bright spot in the report was the increase of 6.9% for restaurants, which bodes well for service organizations as vaccines and warmer weather allow for additional outdoor dining. These gains are poised to gain momentum with the possibility of another round of stimulus spending in the coming weeks.

For more information on how the coronavirus pandemic is affecting midsize businesses, please visit the RSM Coronavirus Resource Center.

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About Seth Bacon

@SethTBacon

Seth is a senior analyst specializing in consumer products for RSM US LLP in the Seattle office. He has more than 10 years of experience serving clients across the country by providing industry- specific insights and thought leadership focused on digital transformation. He has worked with a variety of clients in the consumer products industry helping them focus on acquiring and retaining customers through data driven insight.

In May 2020, Seth was selected as a senior analyst in RSM’s cutting-edge Industry Eminence Program, which positions its senior analysts to understand, forecast and communicate economic, business and technology trends shaping the industries RSM serves. These senior analysts advise clients on conditions influencing middle market leaders.

About Christopher Shaker

@ChrisShakerCP

Chris Shaker is a partner in RSM’s Boston office. He serves as a member of both the firm’s national consumer products and retail teams. In January 2018, Chris was selected as a senior analyst in RSM’s cutting-edge Industry Eminence Program to focus on trends impacting the consumer sector.

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