Retail Sales Recover in October, Inflation Uncertainty Reigns

By at 16 November, 2022, 9:56 pm

by Raymond J. Keating –

The latest data from the U.S. Census Bureau estimated that retail and food services sales in October recovered from a poor September performance.

Retail and food services sales grew by 1.3 percent in October. That nominal gain compared to a 0.4 percent inflation rate for the month. In September, sales were flat, compared to an inflation rate of 0.4 percent.

If we look at the past six months, we not only see volatility, but overall, inflation eating into retail sales.

Source: Federal Reserve Bank of St. Louis, FRED

In addition to what we’ve noted about October and September, August saw growth of 0.7 percent with inflation at 0.1 percent.

While inflation was nonexistent in July, sales still declined by 0.4 percent, and in June and May, inflation ran especially hot (1.3 percent in June and 1.0 percent in May) with retail and food services sales coming in below those rates (1.0 percent in June and 0.4 percent in May).

These numbers highlight several of the woes brought on by inflation, that is, volatility, inflation eating away at gains in sales (with consumers’ dollars buying less and less), and uncertainty.

Indeed, we’re all left guessing as to what lies ahead, or doesn’t, on the inflation front for coming months. That’s all troubling for entrepreneurs, businesses and investors across industries, for workers and for consumers.

Raymond J. Keating is chief economist for the Small Business & Entrepreneurship Council. His latest book is The Weekly Economist: 52 Quick Reads to Help You Think Like an Economist.


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