NRF: September retail sales growth slowed under economic pressures

Retail sales continued to grow in September, but the pace of growth is slowing as consumers face persistent inflation, rising interest rates, and geopolitical conflicts, the National Retail Federation (NRF) said today.

By the numbers, the U.S. Census Bureau today said overall retail sales in September were up 0.7% from August and up 3.8% year over year. That compared with increases of 0.8% month over month and 2.9% year over year in August.

NRF’s calculation of retail sales – which excludes automobile dealers, gasoline stations, and restaurants to focus on core retail – showed September was up 0.5% seasonally adjusted from August and up 2.2% unadjusted year over year. In August, sales were up 0.2% month over month and up 3.6% year over year.  

Those figures show a gradual slowing, since NRF’s numbers were up 3.1% unadjusted year over year on a three-month moving average as of September, down slightly from their higher rate of a 3.7% rise for the first nine months of the year.

“The consumer is still healthy, and today’s report shows households are forging ahead with plenty of buying power despite persistent inflation, rising interest rates, and geopolitical conflicts,” NRF Chief Economist Jack Kleinhenz said. “Firm payroll growth over the past few months has likely helped spending across retail sectors. However, much of the rise was due to car sales, gasoline prices, and food services. When you exclude those categories and look at core retail as measured by NRF, the pace of year-over-year growth is slowing.”

As consumers continue to push against those economic headwinds, they will likely start to focus more on finding low prices and on prioritizing needed items over luxuries,   

“As we gear up for the holiday season, we expect moderate growth to continue as consumers focus on value and household priorities,” NRF President and CEO Matthew Shay said in a release. “Retailers have been hard at work getting holiday inventories in place to provide consumers with great products, competitive prices and convenience at every opportunity.”