Retail sales up 0.3% in August, which was higher than predicted but was driven mostly by a significant increase in motor vehicle and parts dealer receipts.
Weekly unemployment claims fell to 213,000, which was also lower than expected.
Manufacturing indicators from New York and Philadelphia indicated that the sector is contracting.
The Census Bureau announced Thursday that retail sales were more than expected in August, as price increases in a variety of industries offset a significant dip in gas station receipts.
Advance retail sales grew 0.3% from July, above the Dow Jones forecast of no change. The total is not adjusted for inflation, which grew 0.1% in August, implying that expenditure increased faster than prices.
Consumer price index inflation jumped 8.3% year on year through August, while retail sales increased 9.3%.
However, excluding automobiles, sales fell 0.3% for the month, falling short of the 0.1% increase predicted. Sales increased 0.3% excluding vehicles and fuels.
Motor vehicle and parts dealers led all categories in sales growth, climbing 2.8%, helping to offset a 4.2% drop in gas station receipts as prices fell substantially. Online sales fell 0.7%, while bar and restaurant sales increased 1.1%.
Revisions to the July figures suggested to more consumer difficulties, with the initially reported unchanged but a 0.4% fall.
In addition, the “control” group, which economists use to reduce retail sales, remained unchanged from July. The government uses this category to measure retail’s percentage of GDP since it excludes sales from auto dealers, building materials shops, petrol stations, office supply stores, mobile homes, and tobacco businesses.
Higher inflation pushed the top line sales result, but volumes are definitely declining because sales are negative on a real basis,” said Bleakley Advisory Group’s chief investment officer, Peter Boockvar. “Because core retail sales were substantially below projections, GDP estimates for Q3 were reduced.
Pantheon Macroeconomics’ chief economist, Ian Shepherdson, dubbed the release “a mixed report, but we see little cause for panic.” According to him, the property recession will dampen some linked sales figures, but overall spending should improve as real incomes rise.
The retail figures kicked off a hectic day of economic statistics.
In other news, initial jobless claims for the week ending September 10 were 213,000, a 5,000 reduction from the previous week and a better-than-expected 225,000. Import prices declined 1% in August, less than the 1.2% drop predicted.
The Empire State Manufacturing Index for September showed a rating of -1.5, a whopping 30-point increase over the previous month, according to the New York Federal Reserve.
The two Fed readings indicate the percentage of companies reporting expansion vs contraction, implying that manufacturing slowed for the month.
However, the studies indicated that price pressures were easing. The prices paid and prices received indexes in New York fell 15.9 and 9.1 points, respectively, but both remained solidly in growth zone with readings of 39.6 and 23.6. Prices paid plummeted nearly 14 points in Philadelphia, while prices received rose 6.3 points. These indexes were 29.8 and 29.6, respectively, showing that prices are still rising overall but at a lesser rate.
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