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Retail sales grew in September despite economic headwinds

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October 26, 2023

Retail sales continued to grow in September despite consumers dealing with economic pressure, according to the National Retail Federation.

The NRF's calculation of retail sales, which excludes automobile dealers, gasoline stations and restaurants to focus on core retail, showed September was up 0.5% seasonally adjusted from August and up 2.2% unadjusted year over year. In August, sales were up 0.2% month over month and up 3.6% year over year, according to a press release.

"September retail sales show that consumers have retained the ability and willingness to spend despite accumulating economic headwinds from higher interest rates and slowing growth," NRF President and CEO Matthew Shay said in the release. "As we gear up for the holiday season, we expect moderate growth to continue as consumers focus on value and household priorities. Retailers have been hard at work getting holiday inventories in place to provide consumers with great products, competitive prices and convenience at every opportunity."

The U.S. Census Bureau reported overall retail sales in September were up 0.7% from August and up 3.8% year over year. That compared with increases of 0.8% month over month and 2.9% year over year in August, according to the release

"The consumer is still healthy, and today's report shows households are forging ahead with plenty of buying power despite persistent inflation, rising interest rates and geopolitical conflicts," NRF Chief Economist Jack Kleinhenz said in the release. "Firm payroll growth over the past few months has likely helped spending across retail sectors. However, much of the rise was due to car sales, gasoline prices and food services. When you exclude those categories and look at core retail as measured by NRF, the pace of year-over-year growth is slowing."

Earlier this month the NRF reported the U. S. economy is growing despite labor disputes, high interest rates and the challenges of inflation.