Consumers opened their wallets in September as retail sales showed unexpected strength, rising by 1.9% over August for the fifth straight monthly gain, the Commerce Department reported on Friday. Analysts surveyed by Bloomberg had expected a gain of 0.8% after the 0.6% increase in August.
But this strength faces headwinds with the critical holiday shopping season approaching. The labor market is cooling, Congress remains deadlocked on a new round of fiscal aid and coronavirus cases are rising across the country.
Nearly all categories increased, with the biggest gains coming in apparel and accessories, which rose 11%. That could be a reflection of pent-up demand from people who held off on back-to-school clothing purchases as districts weighed whether to open their doors to students.
Motor vehicle sales also gained, rising by 10.9% from last year. Without autos, the report showed a 1.5% increase month over month. Electronics was the only category to show a drop, falling by 6.4% year over year. Food and beverage sales were roughly even.
For more information on how the coronavirus is affecting midsize businesses, please visit the RSM Coronavirus Resource Center.
