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United States: Retail Sales Continue to Rise
By Francis Généreux, Senior Economist
HIGHLIGHTS
f Retail sales grew 0.7% in September, after rising 0.9%
in August and falling 1.6% in July.
f Auto sales were up by a surprising 0.5% in September after a 3.3% decline in August. The value of service station sales climbed 1.8% in September. Excluding motor vehicles and gasoline, sales advanced 0.7% after a strong gain of 2.1%
in August.
f The main upticks were in stores associated with leisure goods (+3.7%), general merchandise stores (+2.0%) and the
“miscellaneous” category (+1.8%). The only declines were in personal care stores (‑1.4%) and electronics stores (‑0.9%).
Food services were up 0.3%, while sales at nonstore retailers rose 0.6%.
COMMENTS
The consensus forecast was for a new contraction in retail sales in September. In this light, the 0.7% gain comes as a pleasant surprise, despite being fairly close to our own forecast. That being said, auto industry performance was nothing short of astonishing as the number of new vehicles dropped 6.4% and
ECONOMIC STUDIES | OCTOBER 15, 2021
prices rose a mere 1.3% in September. Despite September’s increase, retail motor vehicle sales are down 13.1% since April, a direct result of the supply problems plaguing vehicle availability.
IMPLICATIONS
The auto industry’s struggles since the spring, coupled with a perceived slowdown in some other sectors, including furniture, electronics and nonstore retailers, resulted in nominal retail sales suffering their first quarterly pullback since the spring of 2020, despite growth in August and September. This will obviously be reflected in the real consumption of goods (which will be hampered by rising prices as well). However, keep in mind that the spring data reflected a strong boost from government assistance to households. In addition, the service sector continues to recover.
GRAPH 1
First positive contribution from vehicle sales since April
Sources: U.S. Census Bureau and Desjardins, Economic Studies Retail sales Monthly variation in %
-6-4 -202468 1012 1416 1820
JULY OCT. JAN. APRIL JULY
Total Excluding motor vehicles Motor vehicles
2020 2021
GRAPH 2
Retail sales suggest strong consumer growth in the second quarter
Sources: U.S. Census Bureau, Bureau of Economic Analysis and Desjardins, Études économiques Quarterly annualized variation in %
-20 -10100 20 30 40 50 60
2018 2019 2020 2021 Retail sales excluding gasoline, renovation centres and food services
Real goods consumption
Quarterly annualized variation in %
-100 -500 50 100 150 200 250 300
2018 2019 2020 2021 Retail sales – food services
Real consumption of services – food services
