One of the biggest drivers of the U.S. economy shifted into high gear in July, posting its biggest gain in seven months, according to a new Commerce Department report.

Retail sales increased 0.6% from June, the largest gain since December 2016 and better than a consensus estimate from Wall Street.

The department also upwardly revised June’s performance for a 0.3% hike following an originally reported 0.2% drop from May. Retail sales in many earlier months of the year were lackluster.

The June level of retail sales is 4.2% higher than the same time a year earlier. Total retail sales for the May 2017 through July 2017 period were up 3.9% from the same period a year ago.

Helping to push the June level higher was a 1.2% increase in auto sales from the month before, its biggest increase since December. There were also strong gains in sales at furniture stores, hardware stores and restaurants.

Excluding sales of autos, gasoline, building materials and food services, so called “core sales” surged 0.6% last month following an upwardly revised 0.1% increase in June.

Non-store retailers, which includes online shopping, reported sales increased 1.3% in July from the month before, while recording a whopping 11.5% compared to July 2016.

This latest gain in retail sales adds to the hopes that the overall U.S. economy will find even more traction in the current quarter. The nation’s gross domestic product (GDP) increased at an annual rate of 2.6% in the second quarter, up from the 1.2% pace in the first quarter of the year.

The July retail sales report was strong overall, and so was the core retail sales, which goes into the calculation of GDP, according to Eugenio J. Alemán, senior economist at Wells Fargo Securities.

“This means that not only is the second quarter personal consumption expenditures probably going to be revised higher from an already strong 2.8%, but that the expectations for PCE during the third quarter are also going to be marked up going forward," he said. “That is, both indicators for the consumption of goods and services from the retail sales report are looking promising for the start of the third quarter of the year.”

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Evan Lockridge

Evan Lockridge

Former Business Contributing Editor

Trucking journalist since 1990, in the news business since early ‘80s.

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