Consumers are still spending more money in 2018’s growing economy.
May retail sales are up 0.7 percent when seasonally adjusted, building on the 0.5 percent increase in April, the National Retail Federation reports.
Compared to last year, May’s sales were up 5.6 percent. The numbers exclude automobiles, gasoline stations and restaurants.
“The economy is looking strong and households have a solid financial foundation on which to base their spending,” NRF Chief Economist Jack Kleinhenz said.
Kleinhenz attributed the strong economy to increased take-home pay as a result of tax cuts, long-term lows in unemployment and good availability of consumer credit.
“We have seen ongoing momentum over the last several months and believe sales growth should remain healthy and consistent with our 2018 outlook,” Kleinhenz said.
NRF expects 2018 retail sales to grow between 3.8 and 4.4 percent over 2017.
“Nonetheless, inflation and rising oil prices are complicating the picture. And new tariffs or a trade war would certainly be negatives that would increase prices and reduce both consumer purchasing power and consumer confidence,” Kleinhenz said.
Increased sales are fueled by online and other non-store sales up 9.1 percent from last year. In individual sectors, clothing and accessory stores are up the most at 8.2 percent, followed by general merchandise at 5.6 percent and building materials/garden supplies at 5.3 percent year-over-year.
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