Retail Sales Continue to Recover, But at Slower Pace in July

By at 14 August, 2020, 3:12 pm

by Raymond J. Keating-

According to the latest retails sales report from the U.S. Census Bureau, U.S. retail and food services sales continued to recover in July, but at a slower pace.

Retail and food services sales increased by 1.2 percent in July. That was down markedly from growth of 8.4 percent in June and 18.3 percent in May.

Of course, those big jumps in May and June only came after sales plunged in the two previous months – down by 14.7 percent in April and 8.2 percent in March. Retail sales also suffered a small decline (-0.4 percent) in February.

Source: Federal Reserve Bank of St. Louis, FRED

The fact that retail sales have been able to climb back essentially to where they were at the start of the year (in nominal dollars, though) is a rather amazing accomplishment given the dramatic declines in March and April, as well as our continuing economic woes, especially in terms of massive declines in employment. No doubt, some of this is merely a temporary effect of government aid dollars. It’s also not surprising to see the slowdown occur in July.

Source: Federal Reserve Bank of St. Louis, FRED

As for where sales might be headed, all of us, including small business owners, are left with little more than daunting levels of uncertainty given the pandemic, and its impact on the well-being of our health and economy. But at least some encouragement can be detected in the three recent months of data on retail sales.

Raymond J. Keating is chief economist for the Small Business & Entrepreneurship Council.



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