Photo: Evan Lockridge

Photo: Evan Lockridge

Retail sales in the U.S. jumped in August, turning in their best performance in four months.

The U.S. Commerce Department on Friday reported retail sales were up 0.6% from the month before and 5% higher than the same time a year ago.

Sales at automobile dealers increased 1.5% from the month before, the best showing since March, accounting for about half of the August gain. A recent and separate report shows August sales of new cars, light trucks and SUVs in August rose to an annual rate of 17.5 million, the highest level since January 2006.

Excluding sales of new autos, the Commerce Department reported August retail sales increased 0.3%. Excluding sales of autos and gasoline, the gain was 0.5%.

The department also revised July’s retail sales figure from being nearly unchanged to showing a 0.3% gain. June was revised from a 0.2% hike to a 0.4% increase.

Lindsey Piegza, chief economist at the investment firm Sterne Agee, called the numbers "a welcomed step in the right direction.

"Consumers appear to have a bit more spending capacity as we move further into the third quarter, thanks in part to lower energy prices. The fastest way to derail the consumer is sustained, heightened energy prices,” Piegza said. “Continued price reprieve at the pump will help maintain a modest but positive spending pace in the third-quarter, despite minimal improvement in wage growth."

She said while the August performance was far from robust, the declining trend in consumer spending that had been in place since April appears to have abated in August.

“Going forward, while lower prices at the pump will continue to pad consumers' pockets, in order to see a marked increase in spending, particularly to the extent implied by the extreme ramp-up in production, consumers will need sustained, robust income gains,” Piegza said.

0 Comments